Weather Risk Management

BGC Group, Inc., the global brokerage and financial technology company, has added a new hire to its weather derivatives trading desk, taking Leah Loguidice from Arbol for a weather derivatives origination and structuring role.

Having recorded a lower benefit from its weather derivatives for the last contract year, US energy company Star Group (formerly Star Gas Partners) has lifted the top-end of its protection from the weather hedges for its fiscal year 2025.

The Chicago Mercantile Exchange (CME Group) has expanded its range of weather risk transfer products, with the recent launch of seasonal strip weather futures and options contracts.

Analysis from Bloomberg Intelligence suggests participants in the insurance and reinsurance industry should be seriously considering how they protect themselves against the risks of losses from major solar storms, with the peril having the potential to be as costly as major hurricanes.

International specialty insurance and reinsurance group Chaucer has announced its entry into the parametric weather risk transfer space, with the launch of a cover for weather-driven non-damage business interruption.

The National Commodity and Derivatives Exchange (NCDEX) of India is working on the construction of a suite of weather indices to facilitate the trading of weather futures, after the central government recently added weather to its approved derivatives list.

The weather derivatives market has seen activity levels roughly quadruple this year, as trading in weather futures and options on the Chicago Mercantile Exchange (CME) soared, with the main driver said to be the belief that extreme weather events are set to increase.

Munich Re Trading, the division of the global reinsurance firm focused on providing weather and commodity solutions, including derivatives, index and parametric risk transfer, has hired a senior executive from Arbol, as John Coleman joins it to lead origination for agriculture opportunities in North America.

According to analysts at Bloomberg Intelligence, the insurance and reinsurance industry looks to be on-track to suffer over $100 billion of insured weather losses again in 2023.

Climate risk insurtech The Demex Group has raised $5 million from a syndicate of new and existing investors to deliver its severe convective storm (SCS) and other secondary peril focused solution, Retained Climate Risk Reinsurance (RCR Re), to market.