Look like a genius

I am sure that at some point in the last 17 years, the person who purchased pandemic insurance for the Wimbledon tennis tournament had to justify that purchase. Co-workers may have even poked fun at the purchase. I’m sure someone questioned its necessity. In 2020, that person looked like a genius when the policy paid $142 million when the event was canceled because of the Covid-19 pandemic.

Ben Carey-Evans, insurance analyst at GlobalData, told Insurance Journal it was “a very sensible investment.” I hope the person who stuck to their guns and continued to purchase pandemic insurance year after year got a “sensible” promotion.

What if I told you, you could be a genius, too? The one who saves your golf event when it rains? While few people recognized the threat of a global pandemic, when it comes to golf, weather is always a threat – and it’s one you can protect against.

It’s not about the golf

We all know golf events are not just about golf. Many times, they’re about having fun, making friends and raising money for a worthy cause. When it rains on a charity golf event, it doesn’t just cancel the fun, it cancels the funds. When golf events are canceled because of rain, it’s not just the actual golfing that gets washed out. Charity dinners and auctions that follow a day of golfing often raise more money than the golf event itself, but rain can negatively impact attendance at the evening events if it chases players off the course. One rainy event can keep a non-profit from having enough money to fund programs throughout the year. When that happens, no one is having fun.

That’s why it’s so important for those in the golf world to understand the benefits of parametric rain insurance. A rain insurance policy tailored for your event can help protect not just your golf event, but the programs funded by the money raised at the event.

Protection is simple

While rain insurance can make you look like a genius, you don’t have to be a genius to understand it. Rain insurance does exactly what it says. It helps protect your event from losses caused by rain. But the best part is, unlike event insurance, you don’t have to prove a loss or a cancellation to collect. That’s right. If your event can play through the rain, as long as the selected rainfall threshold is met, you get to collect! It’s really that simple.

Here’s how parametric rain insurance works. You set the hours of coverage, the rain threshold and the payout amount. You pay the premium, and if enough rain falls to hit the rain threshold during the risk period, you file a claim and get paid.

Sounds simple, right? Check out this example: You’re planning a charity golf event that will run from 8 a.m. to 4 p.m. followed by a dinner and auction. You want to protect the golf portion of the event from 1 inch of rainfall with a payout of $50,000. We’d take a look at the historical risk of rain on that date at your location and calculate a premium that you pay. If it rains 1 inch or more between 8 a.m. and 4 p.m. at your location on the day of the event, the policy will pay you $50,000 in about two weeks. Easy, right?

The math works

But there’s no room in the budget for this, you might say. I mean, what if it doesn’t rain? Couldn’t you have put that money to better use elsewhere? Maybe, but ask the Wimbledon organizers if they think the 17 years of premiums they paid was worth it last year.

Let’s look at some statistics. Wait, math? I didn’t sign up to read about math. Keep reading. I promise it’s easy to understand.

Unless you live someplace like Los Angeles or the desert of Arizona, the chances that your event will be impacted by rain at least once in a 10-year period are pretty good. Think about this: on any single day in a 20-year period, the chances that someone will make a claim on their auto insurance policy is .015%. In comparison, the chance of it raining a quarter of an inch in Miami on a single day between June and August is 29.1%. But, you say, Miami is a pretty rainy place in the summer. OK, how about Chicago? The chance there is 14.9%. Even Phoenix has a 2.5% chance of rain.

No one argues that car insurance is a bad investment. All it takes is one accident to make you feel like car insurance is worth the price. The same holds true for rain insurance. If you pay a $2,000 premium each year on a policy that pays $50,000, and you only make a claim once in five years, you’ll still be $40,000 ahead. An annual policy more than pays for itself while reducing the risk to your event from rain. Sounds like a pretty good deal to me. And the claim gets paid whether you cancel the event or not. The only thing that has to happen is for the rainfall amount to hit the selected threshold.

Tailored to fit

I don’t know about you, but I’d love to buy tailored clothes all the time. But, alas, I’m not independently wealthy. The great news about rain insurance, though, is that you don’t have to be Bill Gates to afford a policy tailored to your event’s needs. We know that budget constraints are a real thing for most events, but rain insurance is affordable. By changing payout amounts, rain thresholds or time periods, we can customize the policy to give you both a premium and a payout that fits your needs.

OK, ready for some more examples and a little more math? It’s worth it, I promise.

Say you have an event from 10 a.m. to 3 p.m. on April 19 this year in Kiawah Island, South Carolina (bet you didn’t even know that was a place, did you?), and you want $50,000 in coverage. Just by changing the rain threshold, you can tailor the policy to fit your budget. Check out these numbers:

·       At 0.2 inches of rain, the premium is $1,551.

·       At 0.33 inches of rain, it drops to $1,101.

·       At 0.5 inches of rain, the premium gets cut nearly in half to $600.

·       At 0.75 inches of rain, a $50,000 policy is just $346.

It’s not just the rain threshold that can be tailored to fit your needs. Changing the other variables can move the premium into your budget range, as well, helping to protect your event and your charity’s work throughout the year.

Look like a genius

All those numbers and all that math can add up to you saving the day and looking like as much of a genius as the Wimbledon pandemic insurance person. Parametric rain insurance is simple, affordable and easy to purchase, but its benefits are far-reaching. A single rain insurance policy can save the day when a charity golf event loses revenue due to rain. All you have to do to earn the genius title and be a hero to your organization is pick up the phone or send an email. We’ll do all the hard math stuff to create a policy that works for your event. Then you can enjoy golfing, schmoozing, eating and buying things at the auction without having to keep an eye on the sky.