August 17, 2022

Product Spotlight: Snow Insurance

Delivering financial resilience for property owners, facility managers, municipalities, snow removal contractors and snow-dependent businesses.

Carlos A. Oliveras, Head of Insurance

Winter storms are becoming more extreme and highly variable. This unpredictability creates significant challenges for commercial property owners/managers and snow removal contractors alike. Demex’s new Snow Insurance options address these winter challenges in two unique ways:

  • Demex Revenue Protection Insurance is created for snow removal contractors and snow-dependent businesses. Claims are triggered when snowfall revenue is low.
  • Demex Cost Control Insurance serves property owners, facility managers, and municipalities. Claims are triggered when snowfall expenses are high.

Both of these policies are backed by non-admitted paper from Evanston Insurance Company, a subsidiary of Markel, the leader in specialty insurance. Policies carry an A XV rating from AM Best, the largest credit rating agency in the world specializing in the insurance industry.

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Demex Snow Insurance protects against the increasing challenges of extreme and variable winters.

Demex Cost Control Insurance serves property owners, facility managers, and municipalities. Claims are triggered when modeled snowfall expenses exceed a mutually agreed upon amount at each insured location.

Pre-winter premium is calculated with hyper-localized weather data and the policy caps total expenses. In the event of severe snowfall-related expenses, a claim is triggered, reimbursing the policyholder for expenses above the cap. Claim payments offset snow removal costs in extreme winters, reducing budget volatility from year-to-year. 

Traditional fixed-price snow removal contracts exceed per-event pricing in most winters because they overweigh the probability of extreme winters. Demex’s cost control insurance empowers customers to lower costs through per-event pricing while retaining the protection akin to a fixed-price contract.

On average, customers save almost 15% versus the fixed-price alternative. In extremely low snowfall winters, clients can save more than 40%.

In heavy snowfall winters, Cost Control Insurance triggers claim payments.

Demex Revenue Protection Insurance serves snow removal contractors and other snow-linked businesses. Claims are triggered when modeled revenue is lower than a mutually agreed amount.

As with Cost Control Insurance, pre-winter premium is calculated with hyper-localized weather data. Revenue protection is modeled for each policy based on historical revenue per location. The policies are designed with a minimum revenue floor to protect income and earnings stability in low snowfall years.

With Demex insurance, claims are triggered automatically.

Snow removal policies are parametric, meaning that they are triggered by pre-defined measurements.

Unlike traditional insurance, there are no claims adjustors. Claims pay automatically for a quick, hassle-free recovery when modeled revenue or expenses either drop below or exceed the pre-defined triggers.

  • Demex Revenue Protection Insurance is triggered when snowfall revenue is low.
  • Demex Cost Control Insurance is triggered when snowfall expenses are high.
A snowplow operating in Walker, Michigan in January 2022. Nearby Grand Rapids had a record snowfall of 8 inches in early January. Image Source: New York Times

Snowstorms are hyper-local. So is Demex.

Climate change alters snowfall patterns. Storms aren’t following the same patterns as past decades. Some regions are becoming snowier; others are becoming less snowy. In some regions, snowfall is becoming more variable and uncertain from year-to-year while in others, more predictable. Demex technology enables hyper-local modeling.

Demex snow insurance is unique in that triggers vary by location and are customized for each customer, offering protection in a new way with a hassle-free claims process. Our snow insurance integrates property-level snowfall with market-based pricing to both estimate and insure the risk at every location in the United States.

Demex analyzes hyper-local snowfall trends, visualizing changes in snowfall due to recent climate trends. The colored scale ranges from strongly decreasing snowfall trends in dark green to strongly increasing snowfall trends in dark blue.

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