Swiss Re are providing risk capacity and transfer expertise to support an online platform built by CelsiusPro. Companies can enter into weather derivative contracts online via www.celsiuspro.com.
CelsiusPro are claiming that it’s the first time small and medium sized European companies have been able to easily access the weather derivatives market. Not so sure that’s an accurate statement as Weatherbill entered the UK market with their online weather risk platform. It’s good to see some competition starting in this market in Europe as it will hopefully spur these online platforms to improve their offerings by making them easier to use and broadening the range of weather risk products available.
The CelsiusPro system has an intuitive quoting engine with a very easy to use interface. They have a great range of contracts available depending on what industry you select. For example, select Travel & Leisure and you get access to a Low Snow Day contract which is sure to be a hit with the European ski industry, and choose Construction and you get access to Frost and Heat Day contracts, perfect for the UK construction industry who have to down tools due to frost or excessive heat both due to the difficulty to continue working and increasingly stringent health and safety laws.
The range of contracts offered online is impressive from CelsiusPro. Weatherbill offer a custom contract for most industries which I’d assume can be applied to snowfall for example but you cannot quote them online and need to contact Weatherbill for that quote.
It will be interesting to see how these online platforms develop. Given the range of technologies available for online trading platforms we could see very sophisticated weather trades being conducted purely online before too long.