Hillridge Technology Pty Ltd, an Australian software technology company that aims to help users address the climate protection gap, has launched a weather index insurance platform with the support of Mitsui Sumitomo Insurance and Victor Insurance Australia, a subsidiary of Marsh.
Hillridge hopes to provide growers and producers easy access to meaningful weather risk management tools, helping them to hedge revenue volatility associated with the weather and climate related risks.
Using parametric triggers, based on weather indices, Hillridge will offer protection buyers a simple way to access insurance capacity from Mitsui Sumitomo, with the assistance of Marsh managing underwriter Victor, through a technology platform it has created.
“Traditional crop insurance often only covers bushfire and hail. This new platform addresses the larger risks that farmers worry about – like drought, frost, heat stress, and rain just before harvest,” explained Hillridge CEO, Dale Schilling.
It’s the first platform in Australia to offer farmers a way to get real-time quotes for weather insurance or risk transfer protection simply through an online platform.
Any agricultural business that faces revenue volatility due to the weather can buy cover through Nutrien Ag Solutions, Australia’s largest farm services company.
The product was jointly developed between MSI GuaranteedWeather, a weather risk management industry leader and associate of the Mitsui Sumitomo global insurance group, alongside Victor Insurance Australia, an MGU subsidiary of Marsh, and Hillridge.
“The current climate crisis has left some Australian regions and industries underinsured or uninsurable. Parametric index insurance products represent a significant shift in the insurance industry,” explains MSI GuaranteedWeather’s President, Brad Davis.
“We are excited to help develop this innovative insurance product that will revolutionise insurance for agribusinesses. We are continually working towards our mission to use insurance products to help secure a sustainable future for our clients and the planet. Weather Index Insurance aligns with this commitment.”
Mitsui Sumitomo Insurance Company Limited, Australian Branch (MSI Australia), an Australian Prudential Regulation Authority (APRA) licensed insurance company, will underwrite the insurance for the weather parametric product.
MSI Australia recently expanded its strategy to include taking on weather risks in Australia, to help local customers offset their weather-related financial risks.
Payouts are designed to be fast, with the amounts agreed in advance.
As soon as the policy’s conditions are met, the payout is made, triggered by either temperature or rainfall readings, with no lengthy damage assessment required and policy language far simpler than indemnity insurance.