For an example we will look at the case of a farmer wishing to purchase drought insurance. The insurance smart contract can request historic precipitation data and trends for the area where the farmer operates, and set fees and payout amounts accordingly. At the end of the contract period the contract can then purchase data on how much precipitation the area has received during the period of time the farmer bought insurance for. If it has rained enough, the farmer is assumed to have secured a good harvest. However, if precipitation levels did not reach some previously agreed upon threshold the contract acknowledges a drought and the farmer receives his payout immediately. Removing the middle man of an insurance company (And claims adjusters) makes the process much faster, and also more transparent and reliable. It either rained in the farmer's area or it did not.