It’s becoming easier all the time to manage your weather risks from the comfort of your sofa thanks to the launch of a number of weather risk management tools and services which allow customers to customise and purchase weather risk protection (be that weather insurance or weather derivatives) online.
eWeatherRisk is the latest of these online services that we’ve come across (hat tip to Environmental Finance magazine for this article). Using eWeatherRisk you can develop a weather risk management strategy, price, customise and purchase weather risk instruments from your computer on their website.
eWeatherRisk has been launched by well known weather risk industry figure Brian O’Hearne (previously at Swiss Re and before that Guaranteedweather). It utilises data from over 3,900 weather stations in the U.S. and Canada and offers what they say is ‘unprecedented weather risk contract flexibility, pricing and contract delivery in real time’. The weather risk contracts they sell are backed by a Standard & Poor’s ‘A’ rated company (we presume a reinsurer).
eWeatherRisk plans to offer weather risk protection to agricultural companies and businesses seeking to hedge their weather risks.
We’re a big fan of online weather risk tools. The key to these being successful in future will be for them to focus on making the customer interface as usable as possible so it is simple and easy to understand how to structure and buy your own weather contracts. To date, most of the systems we’ve seen look more like a weather derivatives traders screen which is going to be off-putting for your average farmer or business owner seeking out weather cover. The company who succeed first in making a flexible, intuitive, online weather risk tool could become very profitable.