Spectrum has been providing weather insurance for quite a while, and no other broker in the United States places more policies than us. Simply put, we are the top specialty broker in the country. However, we also understand that people like to do business locally, and many times procure their rain or weather insurance through their local crop insurance agent or other local agency. This approach can have both pros and cons. On the plus side, you are working with your neighbor, which can be a good thing. On the other side, they may lack the expertise to ask the proper questions to obtain the best coverage option for you. Oftentimes, they may simply place the same coverage that was placed the year prior, as that is generally the easiest option. But consider this: Would you go to your local doctor for heart surgery? Or would you make the effort to seek a specialist?
While your local crop insurance agent or general insurance agency would have significant knowledge about the insurance business, if they don’t specialize in weather insurance, you’re missing a big piece of the puzzle. In order to provide the best coverage for a client’s needs, it’s necessary to have a deep understanding of what you’re insuring against. At Spectrum, we’re weather experts. In fact, our president is an experienced meteorologist. Before presenting you with the best coverage options, we perform a full assessment of the weather in your area and how it could affect your business.
Asking the Right Questions
It is important that the agent placing your coverage ask the right questions. Not all events are created equal, and by not asking the questions about your specific event, you may end up with a cookie-cutter rain insurance policy rather than a solution that meets your specific needs. After all, a tractor pull has a much different exposure to weather conditions than say, a concert, rodeo or demolition derby. Not only does the type of event matter, but your risk mitigation goals need to be addressed as well. Is your concern more related to weather that is likely to completely cancel your event, or are you more concerned about weather that is unlikely to cancel your event, but will result in significant revenue loss? As it’s not your job to be an expert in weather insurance (that’s our job), you may not even know all the coverage options available to you.
Understanding Your Options
Based on the answers to specific questions about your event, a standard, traditional rain insurance policy (i.e., 0.25 inches of rainfall occurring between 6 and 10 p.m.) may not be the right option for you. You may be better off purchasing a stepped rain insurance policy, which pays a claim based on several rainfall thresholds rather than a single, all-or-nothing rainfall amount. Or perhaps you would benefit from a nonconsecutive dry hours policy, which pays a claim based on the duration of rainfall rather than the amount. Alternatively, you may want to consider a policy with two separate coverage periods, so that rain that occurs throughout the day, or rain that occurs in the evening, would result in a claim, but not two claims if both occur.
Now that you understand the basics of what’s available to you, is your agent asking the right questions? Or are they leaving it up to you to determine the best weather insurance options based on your own knowledge, and not consulting with you about your needs? If you feel as though your broker is just reinstating the same policy you’ve purchased in the past, or if you are only presented with options for a single type of coverage, then perhaps you need to be working with someone with more expertise. At Spectrum, we are here to help. Please feel free to contact us directly to discuss your needs, and we will be happy to provide several suggestions.