One early summer afternoon at the end of May, near a lotus-filled lake in Taipei's Yangmingshan National Park, soon-to-be-married couples having their wedding photos taken were everywhere. The temperature that day had already gone over 30 degrees Celsius, but in the afternoon dark clouds closed in, filling the air with water droplets and making it look like it was about to rain and rain hard.
"Oh God, please don't let it rain!" exclaimed Yiu Yo-yo, a bride from Hong Kong, as she stood in front of the budding lotuses and smiled for the camera. Faced by the threat of rain, though, her smile soon faded. Groom Ho Wing-kwong said the flight to Taiwan, accommodation and living expenses had already cost the couple around US$1,000, so if they had to change locations and do a reshoot because of rain, it would be a hassle and cost them even more money. "If there were some kind of "weather insurance,' and the rates and compensation levels were reasonable, I'd definitely consider it."
Fortunately, after their interruption on Yangmingshan, Ho and Yiu had nothing but blue skies for their reshoot in Danshuei later, but theirs is a common situation. With Taiwan's fickle weather, most couples planning to have their weddings, wedding photos and receptions on the island are concerned by the potential for the heavens to open up and ruin the most special day of their lives.
Recognizing the demand among such couples for weather information and risk management, well-known wedding planners FranceStar partnered up with Fubon Insurance Co. Ltd. and weather forecasters WeatherRisk Explore Inc. to create Taiwan's first wedding weather insurance policy.
FranceStar Vice President Lee Shu-fen explained that weather insurance for weddings and wedding photos is primarily aimed at couples like Ho and Yiu, who come to Taiwan from Hong Kong for their wedding photos. In the future, FranceStar plans to organize the weather insurance so that couples will be able to pay an extra fee of US$60 when they sign their contracts with their wedding photographers and have coverage worth US$330 in the event of 15 millimeters or more of rainfall.
As early as March 2005, Central Insurance Co. Ltd.--now AIG General Insurance Co. Ltd.--began offering the first "rainfall insurance" policy to companies in Yilan running whale-watching operations. In July that same year, Taiwan's professional baseball league took out their first rainfall insurance policy to cover the grand final being held in Kaohsiung. That policy stated that if 10 millimeters of rainfall was measured in a two-hour span on the day of the game, causing the game to be called off and requiring the organizers to refund tickets, the organizers would be entitled to compensation of up to US$130,000.
Tokyo Marine Newa Insurance Co. Ltd., a joint venture between Taiwan's Yulon Group and Japan's Tokyo Marine Co. Ltd., began offering "typhoon insurance" two years ago. The company divides Taiwan into eight insurance zones according to information from the Central Weather Bureau on typhoon activities over the past four decades. Based on each policyholder's historical turnover between the months of May and November, they offer compensation of up to three days' "operating turnover" each time a typhoon hits their insurance zone, up to a total of three claims a year.
With Taiwan's weather insurance market offering a more diverse range of products than ever before, it comes as no surprise that demand in the private sector for weather information is steadily increasing.
In 2004, the Central Weather Bureau granted permission to private-sector companies to provide forecasting and informational services, and so far 11 licenses have been issued. Only two companies have invested in value-added weather products--Peng Chi-ming's WeatherRisk Explore and the Taiwanese branch of Japan-based Weathernews.
Peng, who received the first individual license in late 2004, holds a doctorate in meteorology from National Central University, and is known in the media as "Weatherman Supreme." In mid-2003, before anyone paid heed to his ideas, he used US$165,000 to set up his own business, Taiwan's first specialist provider of added-value weather services, and today he is the operator of Taiwan's largest-scale local meteorology company.
During that first year of operation, the company made only a few hundred thousand New Taiwan dollars, but after much hard work this figure has grown. Last year, the company made US$333,000, and is expected to make double that this year.
According to Peng, WeatherRisk's services appeal to the marketplace because the company can tailor its forecasts for clients that need more specific information than provided by the CWB. An organization planning to hold an outdoor public-relations event at a specific location in Taipei City can give the company their details and get recommendations on whether they should postpone or relocate to an indoor location.
At present, Peng's company has over 80 corporate clients, each choosing plans between US$3,300 to US$6,600 or US$33,300 to US$66,600 a year. Their client base is varied, including Farglory Land Development Co. Ltd., the Family Mart Co. Ltd. convenience store chain and even a top pigeon racer from southern Taiwan.
Lin Tsui-chuan, public-relations manager for the Family Mart convenience store chain, said that the primary function of convenience stores is to give customers what they want and when they want it, and so, if they can provide up-to-the-minute weather information, this will help tremendously in their sales of certain products. One Tuesday in April, for example, the temperature was 20 degrees Celsius, but because of predictions that the temperature would rise greatly by Thursday, the company began a special promotion of its cold noodles, increasing sales of those noodles tremendously as a result.
Farglory Land Development, which has major projects in the Taipei County towns of Sansia and Linkou, works with forecasts for each weekend to determine their level of advertising and media presence. Farglory's marketing team said that the numbers of people looking at property is larger on the weekends and holidays, with more deals closed. If there is a sudden downpour or cold snap, however, this could have a major impact on people's willingness to go out and look at property. "As a result, if we find out the weather is likely to be highly changeable on the weekend, we reduce our advertising level."
Pigeon racing team member Wang, who helped the team's boss get onto the weather-information bandwagon, explained that most pigeon racing routes in Taiwan focus on the Taiwan Strait and the Bashi Channel, and that marine wind speed, wind direction and swells can all have an influence on the pigeons' performance. "Because of that, we need to review weather forecasts to help us decide how much to feed our birds, how to train them, and even how much to bet on the race."
While weather information has been warmly welcomed, Peng admitted that meteorological methods and technology are still fairly limited: Most short-term forecasts provide data for two weeks, at the most. "For forecasts longer than that, such as three to six months, the most we can offer is a rough statistical analysis like "such-and-such-percent chance of generally warm/cool weather.' Generally, the longer the time period, the more likely the forecast is off."
Although the weather-information industry in Taiwan is growing, according to a survey conducted by the CWB in November 2006, out of a valid sample of 1,510 people, only 6.2 percent were willing to pay for weather information services. A further 7.3 percent said they would have to look at the services and fees before deciding. The other 86 percent had no interest in purchasing such services.
According to Yeh Tian-chiang, a section leader at the CWB, the weather-information industry in Taiwan is still young, and the general public is still happy with a free general forecast, while entrepreneurs and businesspeople are still not clear on the utility of paid services. "If the industry can tailor itself to specific demands and develop a wider range of products, I'm confident it will have a bright future."
Professor Lin Neng-hui of National Central University's Department of Atmospheric Sciences, a longtime observer of the weather industry both locally and internationally, predicted that as global competition continues to heat up and put pressure on both domestic and international businesses, having access to the most detailed, accurate information is going to be crucial to success in the marketplace.
"The weather industry is part of the broader knowledge economy, and to businesspeople the costs of getting weather information are relatively low, while the possible returns are huge. Companies abroad are already well aware of the importance of accurate weather data and risk management. Taiwanese companies will have to catch up," Lin said. "If we build it, the business opportunities will come."
--The preceding is the abridgement of an article that appeared in the July 2007 issue of Taiwan Panorama, edited by Taiwan Journal staff.
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