Businesses warned against weather risks

Businesses are being urged to better manage their exposure to weather risks as many are at threat of adverse and abnormal weather conditions, Aon has warned.

The broker said that weather patterns are unpredictable and remain a huge factor that could significantly affect a company’s revenue stream.

However, there are gaps in the traditional insurance markets when it comes to weather risks, leaving many potentially at risk of huge losses.

Aon Underwriting Managers managing director Andy Colbran (pictured) said: “Many clients are adversely affected by abnormal weather conditions and with the increasing uncertainty surrounding long-term weather patterns worldwide, the demand for weather solutions is only likely to grow in the future.”

“Standard business interruption cover will often be contingent upon some element of material damage, while event cancellation cover may be restricted to a single, predefined event.”

As a result, the firm has launched a new offering that aims to bridge this gap.

The new policy, Weather Protect, includes:

• Rain day – pays a pre-defined amount for every day that the rainfall is above the specified level agreed with the organisation.
• Cold day – pays a pre-defined amount for every day that the daily minimum temperature is below a specified level.

Colbran commented: “The Weather Protect product offers a more flexible solution in the sense that it allows clients to identify the weather events that are critical to their business, providing customised coverage to meet their unique exposure.”

“There is no requirement for the client to formally submit a claim, nor provide details of previous claims to underwriters during the quotation process.”