Weather insurance is a type of insurance typically offered to people who run businesses. It is usually not the kind of kind of insurance that is offered for major weather disturbances that cause damage. Instead, it is for any type of inclement weather that might damage business returns, often on a per day basis. There are insurance underwriters that sell same day weather insurance for single events, which is by far more common. Others insurance companies may sell seasonal insurance for those who have businesses that depend on fair weather conditions, such as golf courses.
This form of insurance is sometimes called same-day event insurance. When people work hard planning an event, changes in weather could reduce attendance and total profits. Just as with any insurance, people will pay a premium and will likely have any claims reduced by a deductible amount. Yet once the deductible is met, people may able to reduce profit losses. It’s possible that the insurance will be for one type of weather only that could damage event revenue, and not for all types.
Private individuals instead of business or event planners purchase some weather insurance. Under the title of wedding insurance, some companies will refund a percentage of expenses a wedding incurs if extreme weather prevents many of the guests (or the bride or the groom) from being present. Wedding insurance may have other advantages like covering certain losses or theft too.
Another form of weather insurance is really focused on seasons instead of same day events. The insurance may last for whatever is defined as a “season” and could compensate people who lose money due to poor weather during the season. The golf course owner, for instance, might lose a little less if an unexpected rainy period occurs for several days during his open season, since far fewer customers are likely to play golf if it’s pouring.
Generally, weather insurance does not refer to damage caused to property due to extreme weather situations. It’s usually not something the private individual needs to posses, unless that person is hosting an event. Home or renters insurance policies may cover damage to property or dwellings due to certain kinds of weather, and homeowners or renters should carefully read policies to see if they exclude extreme weather events common in their area, like tornadoes or floods.
Those purchasing weather insurance are usually looking for short or seasonal coverage that may help pay for slight damages that come from bad weather. What must be weighed for each person interested in this coverage is whether expense is justified by risk. Naturally those purchasing this insurance should also read each policy carefully to choose the one with the best coverage and reasonable pricing.