If It Rains, They Give You $500? The Secret of Weather-Based Businesses

Get a $500 refund if it rains during your trip?

This is a bold weather-guarantee product launched by an American travel agency.
You do not even need to cancel your trip or pay a separate guarantee fee; you simply receive the money as long as the promised conditions are met.

That sounds strange, though. Wouldn't the company take a loss if it gives back money every time it rains?
Some companies even refund the money before it even starts raining.

People who go beyond predicting the weather to putting a price tag on it.
How on earth are they making a profit through these calculations?

Video Mug has uncovered their secret.

(Reported by Sim Yeong-gu | Edited by Kim In-sun | Design by Cho Eun-sol | Assistance by Kim Chae-hyun | Produced by SBS Digital News)
※ Please note: This article was translated by AI and may contain errors.