Weather insurance is designed to protect anyone who has a limited opportunity for their events and needs protection against the most uncontrollable variable, the weather. Conditional weather promotions allow you to entice Mother Nature. Example: Customers who win a 100% rebate on their specific purchase if it snows more than 5 inches on Christmas, or if the temperature exceeds 100°F on July 4th. You decide the season, we design the coverage.
Insurable Weather Perils
Rain: Rainfall is the most common insured weather condition. A client selects a minimum amount of rain accumulating during the insured time, from 1/100 (.01) of an inch-the smallest amount-up to any measurable amount. The most common increments are 1/10″, 1/5″, ¼”, ½”, ¾”, or 1 inch. Another method of insuring against rain, is a “rain free hour”, one in which 1/100″ or less accumulates. For either incremental rain or rain free hours, the client can select a deductible for a multiple day event, to reduce the cost.
Snow: Snow, including iced precipitation, is the second most commonly selected peril. The contract can guarantee that there will or will not be snow in certain increments usually total inches, measured as newly fallen snow.
Severe Adverse Weather: Some events will go on “-rain or shine-” and only the most severe weather conditions would cancel them. The Severe Adverse Weather peril is very broad in as much as it includes every meteorological peril. However, unlike most other perils, this one will require that in addition to weather occurring, the event must be canceled.
Temperature: Temperature is measured as minimum, maximum or average. Coverage can be purchased to not go below or above certain thresholds. For utility and other companies, temperature can also be measured as either heating degree days or cooling degree days.
Terminology and Product Options
Selected Rainfall Threshold: The amount of rainfall chosen by the client, which, if exceeded, results in a valid claim. Following are some common threshold choices. Descriptions are offered as a guide, because many variables such as terrain, drainage, and intensity can alter the descriptions.
1/100 (.01) inch of rain: The least amount of measurable rainfall recorded by the National Weather Service. This amount slightly wets the surface without leaving puddles on the ground and is considered non-intrusive to outdoor events.
1/10 (.10) inch of rain: A light rain for 30-40 minutes, moderate rain for 10 minutes, or heavy rain for 5 minutes. Small puddles form, but usually disappear after a short while.
¼ (.25) inch of rain: A light rain for 2-3 hours, moderate rain for 30-60 minutes, or heavy rain for 15 minutes, forming many puddles that do not disappear easily.
½ (.50) inch of rain: A light rain never reaches this amount, so it entails moderate rain for 1-2 hours, or heavy rain for 30-45 minutes, resulting in deep standing water for long periods of time. To understand the differences in the appearance of amounts of rain, pay attention the next time it rains in your area. How long does the rain last? How intrusive is the rain? How much do you think accumulated? Check the local newspaper the next day for a report on rainfall amounts.
