Parametrix (New York/Tel Aviv), a provider of parametric technology downtime insurance, has announced the launch of Parametrix CDN Downtime Insurance. What the company calls a first-of-its-kind insurance coverage protects businesses from the financial fallout of third-party content delivery network (CDN) outages, securing cash flow to fix any damages after a business’s main sales and communication channel is down.
Parametrix CDN Downtime Insurance is designed to address the vulnerability of digital native companies with online presence, content and transactions such as e-commerce, travel, e-mobility, media, healthcare and fintech companies. For online retailers, a Parametrix statement notes, websites are critical sales channels, and CDN downtime renders that channel useless. For fintech companies, their website is their platform for real-time transactions, so when a CDN goes down, their users are unable to transact. In all cases, downtime also tarnishes brand reputation and can lead to loss of customer trust, Parametrix notes.
“Global businesses rely heavily on third-party content delivery networks, which exposes them to CDN downtime risks that they need to mitigate with a plan providing necessary cash flow for business continuity,” comments Yonatan Hatzor, co-founder and CEO, Parametrix. “This and all Parametrix products showcase our ability to monitor performance and availability of global systems, model and quantify risk, and translate our knowledge into coverage with the trust and backing of major insurers and reinsurers.”
Recent examples of CDN outages, include Cloudflare on June 21, 2022, which caused websites including Discord, DoorDash and League of Legends to go down; Akamai on July 22, 2021, which halted traffic to websites including Airbnb, Amazon, Delta Air Lines and FedEx; and Fastly on June 8, 2021, which shut down sites including Amazon, Hulu, and the New York Times.
Parametrix, which is backed by certain underwriters at Lloyd’s of London and a top-three global reinsurer, asserts that CDN Downtime Insurance is the first of its kind and the only coverage against this specific risk factor. While there are cyber, errors and omissions and other policies covering business interruptions, they carry long waiting periods, big deductibles and an arduous claims process, the company statement says. Parametrix CDN Downtime Insurance offers parametric coverage, meaning payouts are pre-assessed. When the policy is triggered, payouts are fast, waiting periods are short, there are no cash deductibles and no long, tedious claims process.
