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Insurance companies rate conditional rebates based upon a variety of factors. If the conditional rebate is weather-themed it will be based on the location of the event (city/state) and history of the weather condition that is being underwritten (temperature, rain, snow, etc.) as well as the limit of
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Sports-themed conditional rebates are rated based on not only the size of the policy, but the history of the particular sports team. This is not only limited to how many wins that particular team has had, but the number of home runs or other circumstances that are being insured under a conditional
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will be awarded to the participating customers). The conditional rebate is typically used with sports- or weather-related conditions. In order to protect themselves from the risk of making such an offer, companies turn to specialty
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to purchase either conditional rebate coverage or promotional weather coverage, where they will pay a premium based on the odds of the "condition" taking place. Conditional rebate insurance can be a very effective
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Ailawadi, Kusum L.; Gedenk, Karen; Langer, Tobias; Ma, Yu; Neslin, Scott A. (March 2014). "Consumer response to uncertain promotions: An empirical analysis of conditional rebates".
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for retailers because for a fixed fee the company eliminates the risk associated with repaying their customers in the event of a
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to increase their sales, generate traffic and create publicity. The rebate is commonly an element of a
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the customer will receive a full refund of all purchases made during the month of
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A conditional rebate revolves around an "if, then…" proposition (in this case: if
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As an example, a retailer might want to insure the following: if a particular
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328:"A Dollar for Your Thoughts: Feedback-Conditional Rebates on eBay"
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