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Newark, Calif. – October 2, 2003
– Risk Management Solutions (RMS), the world’s leading provider of
products and services for the management of catastrophe risk, today
announced that final values for its regional weather indexes show
the summer of 2003 was cooler than normal in the eastern half of the
U.S. and warmer than normal in the western U.S.
The RMS indexes track seasonal temperatures
across 10 regions of the U.S. The indexes are calculated using daily
temperature values at stations that are commonly used for trading of
weather derivatives. For the May to September 2003 summer season,
the indexes show that the summer was significantly warmer than
average in the Northern Plains, Mountain States, Pacific Northwest,
and Southwest while it was near average in the Southern Plains. The
summer of 2003 was colder than average in the 5 regions covering the
Midwest, Atlantic seaboard, and southeastern U.S.
The warm regions in the western half of the
country exhibited the most extreme conditions for the summer. For
example, the Mountain States region experienced a near record-high
seasonal average temperature. Cooling degree day (CDD) accumulation,
a statistic that originated in energy markets to track power demand,
was 933 CDDs for the Mountain States, 34% higher than the average
value for the past 10 years.
The most extreme cold conditions for the
summer were registered in the Midwest region, where the average
daily temperature for the summer was 67.2 degrees Fahrenheit. This
value is 1.5 degrees below the 10-year average of 68.7 degrees and
2.7 degrees cooler than the average daily temperature recorded in
this same region last summer.
“Businesses in the western half of the U.S.
that are adversely affected by hot weather will have had a poor
summer, while businesses in the eastern half that are adversely
affected by cold weather will also have suffered,” said Steve Jewson,
director of RMS’ weather risk business. “This clearly emphasizes the
benefit that weather-sensitive businesses can derive from weather
derivatives and weather insurance. With a well-designed weather
derivative, the effect of these seasonal swings in temperature can
be eliminated from revenues, and businesses can maintain steady
performance whatever the weather.”
All final index values and the record of their
day-by-day progression through the summer season can be viewed on
www.climetrix.com, RMS’ weather risk web site. RMS will start
tracking values of the regional weather indexes for the November to
March winter season on November 2.
About RMS
Risk Management Solutions is the world’s
leading provider of products and services for catastrophe, weather,
and enterprise risk management. More than 400 leading insurers,
reinsurers, trading companies, and other financial institutions rely
on RMS models to quantify, manage, and transfer risk. Founded at
Stanford University in 1988, RMS serves clients today from offices
in the U.S., Europe, and Japan. For more information, visit our
website at
www.rms.com.
Climetrix, RMS,
and the RMS logo are trademarks of Risk Management Solutions, Inc.
All other trademarks are property of their respective owners.
Eric Samansky
TorranceCo
1-212-521-5247
esamansky@torranceco.com
Sarah Smith
Risk Management Solutions
+44-20-7256-3815
sarah.smith@rms.com
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