Key Challenges for the Region
High Frost Exposure: South Australia regularly experiences severe spring frost events, particularly during budburst, when grapevines are most vulnerable to temperature drops.
Sensitive Crop Growth Cycle: Early budburst exposes vines to damage from late cold snaps, significantly impacting yields and grape quality.
Insurance Gaps: Limited availability and capacity of traditional crop insurance leave vineyard owners underinsured against extreme frost events.
Key Benefits of Parametric Insurance
Transparent Terms
Policies are built on measurable triggers—like rainfall or temperature—so clients and their brokers know exactly when payouts occur. No fine print, no ambiguity.
Fast, Predictable Payouts
Once a triggering event occurs, payment is issued quickly and automatically—no need for on-site assessments or lengthy claims processes.
Customized Coverage
We work closely with brokers to build each policy around the client’s specific risk and budget profile, providing protection where traditional insurance often cannot.
Flexible Use of Funds
Payouts are based on the severity of natural events occurring, not solely on proven losses, giving clients immediate access to funds and empowering them to cover any type of financial loss, not just for physical damage.
Spring frost poses a major threat to vineyards in Australia, where sudden temperature drops can severely damage crops during critical growth stages. As climate volatility increases, growers face mounting challenges in securing adequate and reliable protection.
Descartes’ Parametric Frost Insurance: Clear, Reliable Protection for Climate Risk
Descartes’ parametric frost insurance is based on predefined temperature thresholds measured through verified weather data sources. When temperatures fall below the agreed trigger, payouts are automatically activated, providing fast, transparent financial support without the need for on-site loss assessments.
case study example
Parametric Frost Solution for Vineyards in South Australia
In September 2024, South Australia experienced severe frost events that caused widespread damage and over A$2 billion in losses.
Problem
The September 2024 frost event struck the Barossa Valley, dropping temperatures to -4°C during the critical spring budburst. One 80-hectare vineyard growing Shiraz and Cabernet Sauvignon suffered a severe crop loss, causing around A$1 million in damages.
The grower would have been eligible for a full indemnity after the event, but due to limited coverage options from traditional insurers, they were left underinsured. The frost event disrupted production volumes, threatened supply contracts, and impacted the long-term stability of the business. As a result, the grower began seeking alternative solutions to manage climate-related risks.
Solution
Descartes could work with the client and broker to design a parametric frost cover aligned with the vineyard’s key risk period. We would use data from pre-existing on-site weather stations (if available), BOM stations, IoT-driven weather stations and long-term climate trends to determine the coverage.
Result
If a similar frost event were to occur and the temperature reached -4°C, the vineyard owner would receive a full payout at the end of the risk period.
Contact Us
Whether you're quoting a complex risk, looking to break into new markets, or just curious about parametric insurance, our team is here to help you win. Reach out and we will get back to you within 48 hours.
