Funny as it may seem, it is true that weather insurance not only exists, but it is one of the oldest sorts of insurance at all. Since the development of agriculture, farmers‘ everyday living has depended on the weather. The modern weather insurance can cover far more than crops.
Rain – that’s the most common target of weather insurance. Luckily, it is quite easy to negotiate a rain insurance policy. Regarding rain policies, you can select rain accumulation policies (for this, you need to decide how much rain would still be acceptable for your event and how much would already ruin it) or dry hours (how many hours in a period of time were without any rain). Analogically, you can insure your activity against snow – either determine the amount of inches snowed per one session or per one storm. Snow removal insurance is a unique version of a snow policy aimed at municipalities and public organs to cover any extra costs connected with snow.
And that’s just the beginning. A hot air ballooning show can insure themselves against unwelcome wind conditions with wind insurance. There is temperature insurance against cold weather, for example for an ice cream promotion event, to make sure the investment is not wasted.
Usually you can choose your own combination of the various policies needed for your event. Typical customers are film productions (and many insurance companies tailor special policies just for the film industry, including conditions of underwater visibility or lack of snow). Weather insurance is also popular with managers of sports events, concerts, festivals, trade shows… For us, whose business is not directly influenced by the weather, like me, selling life insurance, we can still purchase weather insurance for our free time and our holidays.
This is quite a new product, just getting to the customers from the whole world. When you go on holiday and the weather is much worse than expected, certain French travel agencies (in cooperation with Aon France) are offering partial money reimbursement. Similarly, a new sunshine insurance is now offered by Lufthansa, the German airlines. Passengers from Germany can buy for €20 ($31.24) simple insurance policy, which will pay them €20 for every wasted day (more than 5mm of rain) during holiday.
Of course, for destinations such as Tunisia or Greece, weather insurance is not really needed. And I’m not sure if you are on your way to Vancouver, they will sell you weather insurance. It wouldn’t hurt to ask.
Lorne S. Marr has been a very accomplished financial planner since 1993 and runs his own Toronto life insurance company LSM Insurance Services Ltd. He’s recognized as an industry leader thanks to the commitment to providing clients with value-added services.
Lorne has also been a keynote speaker at numerous industry functions and has appeared in The National Post, The Toronto Sun, the Investment Executive, The Advisor’s Edge and the Insurance Journal. Don’t forget to visit his website http://www.lsminsurance.ca.
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