As an insurance executive, you know that unexpected events can cause catastrophic losses for your clients. That’s why it’s important to be prepared for anything that might happen. The recent PayPal outage is a perfect example of why you need to have a plan in place.

According to a Reuters article, PayPal experienced a global outage that affected thousands of users for nearly two hours. The outage affected multiple products, including account withdrawals, peer-to-peer payment service Venmo, online checkout, and crypto. Exchanges Coinbase and Kraken also reported outages with PayPal transactions and deposit delays on their websites.

The outage occurred on a day when bitcoin, the world’s largest cryptocurrency, surged to levels over $98,000 and pulled other crypto stocks along with it. PayPal allows its clients to buy, sell, and hold cryptocurrency, making the outage even more impactful.

As an insurance executive, you might be wondering what you can do to avoid catastrophic losses like the ones caused by the PayPal outage. Here are some lessons you can learn from this event:

1. Don’t rely on a single provider: PayPal is a popular payment provider, but relying solely on one provider can be risky. Encourage your clients to diversify their payment options to avoid being completely dependent on one provider.

2. Have a backup plan: In case of an outage, it’s important to have a backup plan in place. Encourage your clients to have alternative payment methods available, such as credit cards or other payment providers.

3. Consider parametric insurance: Parametric insurance is a type of insurance that pays out when a specific event occurs, such as a power outage or a natural disaster. It can be a useful tool for mitigating the risks associated with unexpected events like the PayPal outage.

4. Stay informed: Keep up-to-date with the latest news and developments in the payment industry. This will help you anticipate potential risks and take proactive measures to protect your clients.

By following these lessons, you can help your clients avoid catastrophic losses and protect their businesses from unexpected events like the PayPal outage.

At Riskwolf, we specialize in helping insurance builders develop parametric insurance solutions that are tailored to their clients' needs. With our unique real-time data and dynamic risk modeling, we enable insurers to build and operate parametric insurance at scale. Contact us today to learn more about how we can help you protect your clients from unexpected events like the PayPal outage.

Source: Reuters