What is weather risk?
There is no formal definition of weather risk. However, oftentimes weather risk is defined as the variability of operational and financial variables (Sales, EBIT, Net Income,etc.) that is caused by non-expected or adverse meteorological conditions. Or, to put it in other words, it is the uncertainty aboute income generation caused by non catastrophic climate events. In general terms, weather risk may be the most extended risk factor globally. Climate events do not have to be extreme to suffer the loss; with a few days raining slightly more than average may be enough for a considerable economic damage.