Lloyd’s has launched profit protection cover for the hospitality sector, using a parametric trigger to indemnify customers in event of an insured loss.

In the event of an insured event, a pay-out is triggered that protects the hotel’s profitability, reducing cash flow volatility and unlocking contingent liability exposures.

Head of innovation at Tokio Marine Kiln and chair of the product innovation facility, Tom Hoad hoped that the new product would provide much-needed peace of mind for hotel owners and tour operators and would remove some of the volatility in the sector.

Lloyd’s CEO, John Neal added: “Lloyd’s has a well-deserved reputation as the home of insurance innovation and I’m delighted to see the speed with which the new product innovation facility, whose capacity has more than doubled in the past few months, is moving.

“Using the combined expertise, insights and entrepreneurial spirit of all those involved, we’re developing, incubating and launching exciting new products to meet the very real needs of today’s world.”

The policy is the first product developed by Lloyd’s product innovation facility, which was launched in June and is backed by a group of 24 Lloyd’s syndicates. Led by Tokio Marine Kiln, the product is also endorsed by insurers such as Chaucer, Munich Re Syndicate, Beazley, Faraday and Axis.

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