OREANDA-NEWS. March 15, 2011. IC ROSNO has presented a new weather insurance program. At the seminar held for the clients interested in protection against unfavorable weather conditions, the experts from ROSNO and Allianz told about the new program and their experience in implementing this type of insurance abroad, reported the press-centre of ROSNO.

According to the estimates made by Allianz, 80% of all worldwide business activity depends on weather. And, while the Russian weather insurance market is in nascent condition, the global market has already accumulated vast experience in this field. Weather insurance is most popular in the United States, Australia, Europe, Japan, SAR, and Chile. Allianz Group underwrites about 20% of annual insured limits allocated on the OTC basis in the weather insurance market. Within Allianz, the development of this insurance field is coordinated by the special unit — Allianz Risk Transfer, (ART), formed in 2008. During these three years, ART concluded 30 transactions with 12 counterparties in 11 countries.

During the seminar, ROSNO experts for the first time presented the company’s weather insurance products based on Allianz’s expertise and introduced in early 2011. Under this program, ROSNO compensates lost income or unforeseen expenses borne by the insurant as a result of unfavourable weather conditions (unusually mild/cold winter, hot/cold summer, precipitation volume deviations, etc.). Weather conditions are assessed on the basis of heating and cooling indices or other indices, depending on the insurance contract.

"Last year, the weather itself evidenced the importance of this type of insurance for Russia. Weather insurance may be beneficial both to retail clients and large businesses, including energy suppliers and consumers, organizers of entertainment events, food and drink manufacturers, transport and construction companies, and shopping mall operators. For example, frosty conditions boost premise heating costs incurred by large retail outlets, and the summer heat similarly increases the air conditioning costs. Cold summer decreases the volume of retail trade in certain commodity articles, while warm winter reduces gas suppliers’ revenue. There are plenty of examples how weather affects various economic sectors", comments Mr. Leonid Golovanov, head of ROSNO’s Agricultural and Natural Risks Insurance Department.