Design Weather Protection Contract
Use our free on-line tool to design the weather protection contract you need with free access to thousands of weather data sets and more on request.Free
Request Instant Indicative Prices
Request Instant Indicative Prices to help “tune” your weather protection contract.Free
Send firm pricing requests to multiple Protection Sellers at a click of a button to compare quotes. Or, contact a Broker-Advisor for in-depth advice or anonymity.Free
Request Settlement Data
After buying a weather protection contract, request Settlement Data (chargeable).Paid for by Protection Seller
Request Calculation Services
After buying a weather protection contract, request Calculation Services to value the deal for internal and / or regulatory reporting. (chargeable).Optional service, chargeable
weatherXchange makes no charge to those using the Platform to buy Weather Protection.
weatherXchange also takes no “soft-commission” from either Broker-Advisors nor from Protection Sellers on the Platform.
weatherXchange® believes that easy access to index-based weather risk protection is critical for businesses which need to address earnings volatility or uncertainty arising from weather. These businesses include farmers, energy companies, construction companies, and those in the retail and tourism sectors.
As an independent platform, weatherXchange makes accessing weather 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 to Broker-Advisors who can advise and arrange the protection on the Hedger's behalf.
The weatherXchange® Platform also addresses the post-trade requirements of providing independent quality Settlement Data and, for Hedgers who need to track and value a weather hedge, of providing Calculation Services.
weatherXchange is only available to larger corporate users, not private individuals.
Our goal is to make it easier for both new and existing users to buy weather risk protection by:
- Providing access to free, high quality weather data worldwide to companies looking for weather protection
- Providing free tools and optional assistance to streamline the structuring process
- Introducing new Hedgers to Protection Sellers and Broker-Advisors
- Providing access to Instant Indicative Pricing from multiple Protection Sellers
- Allowing a tradable price to be requested from multiple Protection Sellers at the click of a button
- Facilitating communication between Hedgers and Protection Sellers through technology
- Making the process of tracking and settling a weather risk structure 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 Index-Based Weather Protection?
The index-based weather risk market was established in the late 1990’s.
Index-based 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 to pay 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.
Our weather hedge structuring wizard helps you create your weather protection contract