A new spin on crop insurance

Techies in California have launched an insurance service for farmers seeking insulation against the largest source of crop loss — bad weather. It’s called WeatherBill, and the company’s deep-pocketed investors are betting that they’ve caught lightning in a bottle. The San Francisco company, which already sells insurance against nasty weather to clients such as the U.S. Open tennis tournament, is in the midst of shifting 80 percent of its focus to agriculture. “Clearly we think there’s a big market for this,” said Greg Smirin, vice president of marketing and product for WeatherBill. On its face, the sales pitch to farmers is simple: Insure against bad weather during key times of year such as the planting season — a protection that goes beyond what is available through federally subsidized crop insurance. WeatherBill essentially insures against lost yields (and profit) during harvest that could be the result of, for example, difficult planting conditions. The mechanics of WeatherBill’s product, however, are decidedly more complicated. The company, founded in 2006 by ex-Google development team members, weaves together sophisticated weather models and market factors, then spits out scenarios on its website showing estimates of how much a farmer could lose due to bad weather — excess rain, heat, drought or freeze. The website then offers up plans that would, for example, pay if rainfall goes over a certain level more than six times during a prime planting month...more