The Weather Risk Management Association (WRMA), an international trade organization of the weather risk management industry, recently completed in conjunction with PriceWaterhouseCoopers, a comprehensive survey of the weather market. The study queried a broad cross section of providers from around the world, and focused on the nature and scope of the deals that have been completed since the first weather-related transaction in the winter of 1997.
According to the survey, the market to-date totals nearly $7.5 billion and the number of contracts executed has grown by 3,264 percent since the first was completed in the winter of 1997.
In addition to measuring the number of contracts and the total value of the market, the survey measured the types of deals being transacted. The resulting data revealed that what was once a market that almost exclusively covered profit loss due to excess heat and cold has matured to encompass contracts protecting against rain, snow and wind.
The industry survey is the first information-gathering project initiated by WRMA, which was formed in 1999 to bring weather risk management providers together as well as educate the end-user market.
WRMA, founded in 1999, is dedicated to promoting the industry both to those within it and to end-users. Today, WRMA, comprised of over 70 weather risk management companies from around the world, promotes the industry by initiating surveys; advocating the standardization of contracts and other documentation used for transactions; and sponsoring forums and conferences around the world. For more information on the survey, go to http://www.wrma.org.