Use the wizard to design the Weather Protection Contract you need
Connect with Broker-Advisors
or Protection Sellers
Choose the counterparties to request a price and compare prices
Request Settlement Data
After closing the hedge through the Broker-Advisor or with the Protection Seller directly, request Settlement Data and track the deal
weatherXchange believes that easy access to weather risk hedging is critical for businesses which need to address earnings volatility or uncertainty arising from weather. These include farmers, energy companies, construction companies, and companies in the retail and tourism sectors.
As an independent platform, weatherXchange makes accessing such protection easier than ever before by streamlining the process of designing a Weather Protection contract and then connecting the Hedger with the companies in the market who can provide the protection directly or who can advise and intermediate in its provision.
Our goal is to facilitate weather risk hedging by:
- Providing access to free, high quality and ubiquitous weather data worldwide to companies looking for weather protection
- Providing free tools and optional assistance that de-skills and streamlines the structuring process
- Introducing new Hedgers to Protection Sellers and Broker-Advisors
- Facilitating communication between Hedgers and Protection Sellers through technology
- Making the process of tracking and settling a Weather Protection Contract easier
weatherXchange makes no charge to those using the platform to buy Weather Protection nor does it charge a broking fee or membership fee for Protection Sellers or Broker-Advisors. weatherXchange also takes no "soft-commission" from either Broker-Advisors or Protection Sellers on the platform.
What is Parametric Weather Protection?
The parametric weather risk market was established in 1997
Parametric weather risk hedging uses observed weather data at a weather station to create an index on which a payout is based. This index could be total rainfall over a relevant period, or the number of days of minimum temperatures below zero. Most weather protection is designed as a structure that pays out when an index is above or below a certain level. Such structures can be very flexible and tailored to the risk profile of the Hedger. The buyer of Weather Protection can choose the most appropriate weather index, for any risk period, with any level at which payments start and with any desired monetary payment per millimetres of rain or per days of extreme temperatures (etc.).
Unlike traditional, "indemnity", insurance-based cover, there is no need to demonstrate that a loss has been suffered. Settlement is completely objective, based on the final value of the chosen weather index over the period defined. If a payout is due, it is usually made in a matter of a few days with the Settlement Period being defined in the contract. So, unlike insurance contracts, there is no "loss adjustment" process.