Now This Is Umbrella Insurance

Wed, Aug  13, 2008 - By Daniel McGinn

We're in the homestretch of summer, and my family is squeezing in as much fun as we can. We're staying late at the pool, eating outside more often and chasing the ice-cream truck down the street. I'm also obsessing over the weather, going online to check Doppler maps and 10-day forecasts as I hope for sunny skies. Americans' weather fixation drove NBC Universal, Bain Capital and Blackstone Group to sign a $3.5 billion deal last month to buy the Weather Channel and weather.com. It's a smart bet: with experts predicting that global climate change is making weather more unpredictable, there's reason to believe we'll keep watching.

That's especially true for businesses. According to the Commerce Department, about one third of the U.S. economy is affected by weather. That includes big sectors like energy or agriculture, but plenty of small businesses, too. David Friedberg realized that a few years ago, while commuting from his San Francisco apartment to his job as a top executive at Google. Each day he passed a rental shop called the Bike Hut. "When it was rainy out, the store would literally close down—the guy wouldn't even come in to work," Friedberg says. "I thought, 'That's such a terrible business—whether this guy makes money in any given week is based totally on whether it rains or not'." So Friedberg created a business that might help. He left Google and in early 2007 launched WeatherBill, which helps insulate businesses against the vagaries of weather.

Read the complete story - and hear what the premiums Wendell Johnson has to pay to hedge against too little snow at the Flagstaff Nordic Center...