What is it?
Promotion weather insurance permits buyers to offer full, or partial refunds to consumers on items purchased during an agreed promotional period, if a defined weather peril occurs during the period agreed at a specified location.
Prestige Cycling Apparel is a global sportswear brand. Sales in the UK are in need of a boost and it is looking at ways to tie their fortunes to the upcoming, and eagerly anticipated, Tour de Wales starting in Swansea on the 24th June. The company’s usual turnover is GBP 20,000 from UK online business in May, but predicts that with an attractive promotion it can increase this to GBP 30,000. It has an insurance budget of GBP 2,000.
It runs a sales promotion offering a 50% refund on all products purchased through its website in May, if 2.5cm of rain falls in Swansea on the day of the Grand Depart on 24th June.
Prestige Cycling Apparel generates GBP 28,000 revenue online in May. 4.6cm of rain is recorded in Swansea between 00:00 and 24:00 on the 24th June. The policy pays out GBP 14,000.
Prestige Cycling Apparel generates GBP 28,000 revenue online in May. 1.3cm of rain is recorded in Swansea between 00:00 and 24:00 on the 24th June.
Star Travel is a hotel chain specialising in mini-breaks to Rotterdam. In recent years, it has seen profits fall over the months of April and May and it is looking for ways of increasing revenue.
Star Travel works with Weatherproof who offer them a number of solutions at varying budget points based on their predicted sales. After reviewing their options, the company runs a sales promotion whereby they offer a 50% refund on all flight and hotel packages purchased at least 21 days prior to the trip should the temperature average 10°C or below in Rotterdam in daylight hours (08:00 until 20:00) on the Saturday of their stay.
The temperature in Amsterdam averages 10°C or below between 08:00 and 20:00 on four of the nine Saturdays during the Insured period. The Policy pays Star Travel 50% of the value of all the eligible trips.
April and May are particularly warm and none of the nine Saturdays are triggered. Star Travel profits anyway due to increased sales on the back of the weather promotion.
24 Carat Gold Ltd, a jewellery retailer, has launched a promotion to increase sales around the critical day of Valentine’s Day. Any customer who bought gold jewellery in the month of January would get sent a free sales voucher worth USD 200 if it snows on Valentine’s Day.
Weatherproof pays the Client the value of all the sales vouchers from the eligible sales period if it snows on Valentine’s Day.
24 Carat Gold Ltd sell gold jewellery to 40 separate customers in January. 0.03cm of snow or more falls between 00:00 and 24:00 on the 28th February at the store location. The policy pays out USD 8,000.
24 Carat Gold Ltd sells gold jewellery to 40 separate customers in January. No snow falls between 00:00 and 24:00 the 28th February at the store location.