Original text here from Patrice Bernard (LinkedIn)
As InsurTech startups attempt to capture the lucrative market of payment-related insurance—historically dominated by card networks—Visa is preparing an innovative response in Europe through a partnership with parametric insurance specialist Companjon.
As is customary in this sector, the product is made available to card issuers, who can choose whether to offer it to their customers. However, unlike traditional payment-linked coverage—such as travel cancellation, lost or damaged items, or rental car insurance—this new solution is designed as a more context-specific option.
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The idea is to allow cardholders to purchase weather protection—covering rain, snow, or extreme temperatures—whenever they buy something relevant, such as an outdoor concert ticket, a beach resort stay, or a mountain excursion. Issuers can configure the deployment parameters as they see fit, positioning Visa more as a facilitator than a direct service provider.
The premium is calculated in real-time by Companjon’s AI models, which assess risk factors such as location, season, and event type. The insurance payout mechanism is standard for parametric coverage: if predefined thresholds (e.g., precipitation levels or temperature extremes) are exceeded during the insured period, based on official weather data, the compensation is automatically disbursed to the policyholder.
This initiative reflects Visa’s necessary diversification efforts in response to the growing threat of disruptive competitors offering more consumer-centric insurance products. It also provides issuers with a unique differentiation opportunity, as they can customize the offering to fit their target audiences. This approach may also inspire other players designing insurance policies embedded in payment solutions.
And for end users? If widely adopted by the industry, the frequent exposure to insurance options at checkout could significantly raise awareness of embedded and parametric insurance. Currently, these models remain too discreet—often unfamiliar and, consequently, met with skepticism—hindering their broader adoption.
