Weather derivatives/insurance

Document description

This paper and the workshop will concentrate on the issue of pricing this business, as this is likely to be where the actuary is asked to help.Portfolio management issues will also be mentioned.Some actual weather data, as provided in a typical submission is provided in the appendix. You may find the workshop more useful and interesting if you have an attempt at using the data provided to estimate the expected loss costs of the contracts suggested.Some suggested approaches to pricing these risks are suggested in this paper. These are intended to provide food for thought and are not intended to be prescriptive.