This is an easy answer:
An anemometer constantly measures and records wind speed. It collects the maximum wind speed, the sustained wind speed, the slowest wind speed. In fact, every wind speed is measured and recorded.
A hail measuring station constantly measures and records every hail strike. It collects the largest, smallest, and in between with a time stamp for each one to the micro second.
If you want to use those measurements to trigger a parametric policy payout, we need more information. While the measurement from stations are very accurate, it is only very accurate at the exact location of the station. Basically a few square feet for either one. Too small to trust.
Why is it too small? Because a parametric policy payout is based on the wind speed or hail size impacting your entire property. That may be as small as a roof, or an acre of roofs or 100s of acres or as large as a State.
A wind or hail station is a valuable tool. But, it’s footprint is too small for you to trust that the same wind speed or hail size that was measured was the same all over the insured location.
Think of it this way: If you want to insure a single car or a small part of your roof, a station measurement is a good trigger. If you want to insure 500 cars or a building complex, you need more than a station.
A wind or hail station is a highly accurate data point. It anchors the measurement process for determining the wind speed or hail size that impacts the entire property. They are data collection points.
How do Hailsure parametric policies determine the maximum wind speed or hail size for parametric policy triggers? How is the entire insured location covered?
This is an easy and simple answer. The most important requirement (besides accuracy) is that in order to be un biased, the measurement must be independent. Independent from Hailsure or the insurance company. Be suspicious if the policy says the insurance company or the insurance broker is providing the measurement.
So how are they measured: It is slightly different for wind speed or hail size.
WIND: Your insured property is smaller than a hurricane. While wind speeds (gusts) vary, it is the sustained wind speed that does extensive and widespread damage.
The National Weather Service has an installed network of wind anemometers along the coast. The National weather service also deploys the Hurricane Hunter planes into the eye of the storm to search and record the highest wind speed of the storm. This information is constantly broadcast. The intensity of the hurricane is reported as Categories 1 to 5.
The ideal data base for a wind speed parametric policy is the wind speed reported by the National Weather Service. This is an independent data provider.
Unfortunately for you, the National Weather Service does not have an anemometer on your property and the planes do not fly over your property.
For a wind speed parametric policy trigger, you should choose a distance from your property for the wind speed to be measured. It is as simple as: the policy is triggered if the wind speed is measured at CAT 1 (or 2 to 5) anywhere within 20 miles (or a distance of your choice) of your property location.
This type of distance and speed trigger takes into account that the wind field of a hurricane is large. If the speed is CAT 1 20 miles from your property, the insurance company is willing to accept it is close enough to trigger the CAT 1 payout at your property.
HAIL: Hail is much more local than a hurricane. Hail falling 20 miles away is too far. For a parametric hail trigger, you need to know what fell on your property.
A hail measuring station is a very important data collection point for a hail parametric policy. The station is not guaranteed to catch the largest hail, but it will record the size distribution and duration of the event. Great information. But, not good enough for you to trust that larger hail did not fall on the other side of the property.
We need a precise measurement of the largest hail and the unique geographic hail distribution.
Fortunately, the National Weather Service provides that information. The NWS has an installed network of weather radar stations. Everywhere. When the images of 2 or more stations are combined, a 3D image is created. Individual hail can be measured to 1/1000 of an inch. Your local news station uses this data to warn of the possibility of damaging hail approaching.
The key is determining where that hail fell.
For a hail parametric policy trigger, you should choose a policy that uses an independent data provider that analyses the data from a hail station and the NWS and any other local source to determine the hail size that falls anywhere on your exact location. If you have a building complex or 5 acres of new cars, the measurement must include the entire property.