Weather risk transfer: A growing weather data-driven area of finance

Weather risk transfer: A growing weather data-driven area of finance

Day-to-day variability of weather like temperature, precipitation, and wind—which is distinct from natural catastrophes like hurricanes and severe thunderstorms—can have significant financial impact on sectors like energy, agriculture, water, construction, and outdoor entertainment, amongst others. Businesses and governments that hold weather risk can choose to transfer it to a financial institution like an insurer. They shed weather risk by paying a premium to the financial institution, in exchange for financial protection when weather is bad for business operations. Weather risk transfer has grown into a multi-billion dollar market because of ample historical weather data; a large appetite of financial institutions for weather risk; and the intuitive relationship between weather and the financial performance of weather-exposed entities. However, market growth has been slower than expected. This is largely due to a lack of independent advisors who understand weather and have the analysis expertise to quantify the linkages between weather and a weather-exposed entity’s financial performance. Such an advisor would be well positioned to translate weather into the financial concern of interest, creating an environmental and economic opportunity for the advisor, weather-exposed entities, sellers of financial protection, and the broader weather risk transfer market.

At Nephila Advisors LLC, Matthew has the role of Portfolio Analyst and works within the Weather Risk investment strategy. Matthew's expertise includes designing customized risk transfer products; quantifying the frequency and severity of weather and water events; and ongoing portfolio management and business development. He joined the company in July 2011 and previously worked at Citadel LLC and the National Center for Atmospheric Research (NCAR), giving him a unique blend of experience in capital markets, insurance, and weather risk management. Matthew has an MBA in Finance from the University of Virginia’s Darden School of Business, an MS in Meteorology from the Pennsylvania State University, and a BS in Chemistry and Environmental Sciences from the University of Virginia. Matthew is an alumnus of NCAR’s SOARS internship program.

Tuesday, June 27, 2017 1:30PM-2:30PM FL2-1001



Room Number: 

Type of event:

Will this event be webcast to the public by NCAR|UCAR?: 
Announcement Timing: 
June 19, 2017 to June 27, 2017
Calendar Timing: 
Tuesday, June 27, 2017 - 1:30pm to 2:30pm