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Everyone talks about the weather, but no one has ever been able to do anything about it–at least up until now. But with the launch of the Chicago Mercantile Exchange (CME)-Carvill Hurricane Index set for March 12, insurers and customers such as energy companies, utilities, state governments and others will be able to hedge their risk to weather catastrophes. CME-Carvill Hurricane futures and options contracts will trade on the CME and will allow insurers and companies, which were battered by Hurricanes Katrina and Rita in 2005, to transfer their risk onto the capital markets. The ReAdvisory group of Carvill America Inc., a reinsurer, developed the Carvill Hurricane Index; the index uses such factors as maximum wind velocity and size of storm to calculate the potential for damage. Futures and options contracts will be offered for five U.S. regions: the Gulf Coast, Florida, Southern Atlantic Coast, Northern Atlantic Coast and the Eastern U.S.

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