scholarly journals AGRICULTURAL INSURANCE IN ESTONIA – CURRENT SITUATION AND FARMERS’ WILLINGNESS TO USE CROP INSURANCE

2016 ◽  
Vol 10 (1) ◽  
pp. 122-128 ◽  
Author(s):  
Maire Nurmet ◽  
Katrin Lemsalu ◽  
Anne Põder
Keyword(s):  
Risk Management ◽  
Risk Sharing ◽  
Crop Insurance ◽  
Insurance Companies ◽  
Management Tool ◽  
Agricultural Risk ◽  
Agricultural Insurance ◽  
Production Risk ◽  
Farm Survey ◽  
Willingness To Use

Farmers are strongly exposed to agricultural risks and have to adapt their strategies to the new uncertainties resulting from the changes in the EU agricultural policy. So far, risk sharing strategies in the context of production risk management have received little attention in Estonia. The aim of the paper is to examine the current availability of agricultural insurance in Estonia and the farmers’ attitudes towards insurance as a risk management tool. The analysis is based on a farm survey conducted in 2015. At first, an overview on available insurance products is given. Secondly, farmers’ interest towards insurance and the connection between farm characteristics and the interest, is studied. The results show that availability of agricultural risk management instruments is limited in Estonia. Agricultural insurance includes protection against livestock production risks provided by two insurance companies, and there are no instruments for crop insurance available. The results of farm survey show that farmers’ interest towards crop-yield and crop income insurance is relatively limited. The main reasons cited by the farmers are too high insurance premiums and the lack of trust in the insurance provider honouring the insurance claim. Younger farmers were more interested in insurance.

scholarly journals Assessing agricultural risk management using historic crop insurance loss data over the ogallala aquifer

2020 ◽  
Vol 232 ◽  
pp. 106000 ◽  
Author(s):  
Julian Reyes ◽  
Emile Elias ◽  
Erin Haacker ◽  
Amy Kremen ◽  
Lauren Parker ◽  
...  
Keyword(s):  
Risk Management ◽  
Crop Insurance ◽  
Ogallala Aquifer ◽  
Agricultural Risk ◽  
Agricultural Risk Management ◽  
Loss Data

scholarly journals Derivative products and innovation in Islamic finance

2014 ◽  
Vol 7 (3) ◽  
pp. 242-257 ◽  
Author(s):  
Seng Kiong Kok ◽  
Gianluigi Giorgioni ◽  
Jason Laws
Keyword(s):  
Risk Management ◽  
Risk Sharing ◽  
Supervisory Board ◽  
Management Tool ◽  
Islamic Finance ◽  
Management Tools ◽  
Content Type ◽  
Risk Transfer ◽  
Financial Framework ◽  
The Creation

Purpose – The purpose of this paper is to highlight the possibility of structuring an Islamic option which includes an element of risk sharing as opposed to risk transfer. Design/methodology/approach – The approach adopted in this research involved a combination of a wa’ad (promise) and murabaha (cost plus sale) and examining if they could form a risk-sharing Islamic option. The payoffs were assumed to be dependent on bi-period outcomes. Findings – The paper attempted to create a hybrid risk-sharing option by combining elements of both wa’ad (promise) and murabaha (cost plus sale). The results yielded are dependent on the eventual direction of the market (in-the-money, at-the-money and out-the-money). While the results are not definitive, they do provide arguments for the adoption of a risk-sharing, as opposed to a risk-transfer, methodology when it comes to structuring risk management instruments. Research limitations/implications – One of the major limitations of this research is the inability to assess the Shariah compliance of the proposed instrument. Shariah compliance is determined by a Shariah Supervisory Board, and every effort has been made to ensure that Shariah financial principles are adhered to in the creation of this structure. Practical implications – The structure provides some interest arguments in the creation of risk management tools under a Shariah financial framework. The structure illustrates the benefits of having a risk-sharing mode over the conventional risk-transfer stances of most risk management tools. Originality/value – The paper offers a new way of structuring a risk management tool in Islamic finance. It explores the highly debated area of derivatives in Islamic finance and proposes a new way of creating a risk management tool that involves some elements of risk sharing.

scholarly journals Development of Agricultural Insurance of Crop Production in Regions of Southern Russia

2020 ◽  
pp. 183-194
Author(s):  
Ekaterina Shkarupa ◽  
Irina Anikina
Keyword(s):  
Crop Production ◽  
Crop Insurance ◽  
The State ◽  
Insurance Companies ◽  
Agricultural Crop ◽  
State Support ◽  
Agricultural Insurance ◽  
National Union ◽  
Mandatory Requirement ◽  
Southern Russia

State-supported agricultural insurance is a financial policy imperative in agricultural development. The purpose of the article is to study the current state of the development of agricultural insurance of crop production carried out with the state support of the regions of Southern Russia in order to determine the possibilities of expansion of its scope and increase of its accessibility. It was concluded that there had been significant changes in the market during the period under review. The article presents the analysis of agricultural insurance on the example of crop production carried out with the state support of Southern Russian regions. After 2014 there was a decrease in the activity in agricultural insurance both by insurers and insured. The dominant reason for a considerable drop in insurance in crop production has been the transformation of forms of state support for agricultural producers since 2017. It is the transfer to a “single subsidy”, which included all types of industry support costs that lead to the inability to pay crop insurance premiums in many regions, in particular South Russia. It should be noted that since 2016 there has been a decrease in the number of insurance copmpanies that have carried out insurance with state support. This was a result of the tightening of control over insurers by the Bank of Russia and the emergence of a mandatory requirement of membership in the National Union of Agricultural Insurers to those insurance companies that insured producers with government support. Thus, the changes of the terms of insurance subsidies became a threat to this form of support. Recently, there has been some modification of this form of support for the industry, and the task of the state is to consolidate this trend. The study concluded that the attraction of more insurance companies to regional markets, involvement of representatives of medium and small businesses in the agricultural risk insurance system, increased flexibility of insurance conditions with state support and improved quality of insurance payment procedures, possibility to independently determine the increasing factor for arable lands, compensatory subsidies written into agricultural crop insurance contracts will facilitate the access to this measure and expansion of this form of support.

scholarly journals Risk Management Strategies in Humid Production Regions: A Comparison of Supplemental Irrigation and Crop Insurance

2004 ◽  
Vol 33 (2) ◽  
pp. 220-232 ◽  
Author(s):  
Timothy J. Dalton ◽  
Gregory A. Porter ◽  
Noah G. Winslow
Keyword(s):  
Risk Management ◽  
Crop Production ◽  
Crop Insurance ◽  
Management Strategies ◽  
Economic Feasibility ◽  
Supplemental Irrigation ◽  
Production Risk ◽  
Enterprise Risk ◽  
Risk Management Strategies ◽  
Management Responsibility

Recent federal agricultural programs have accelerated the devolution of enterprise risk management responsibility from the state to individual producers. Using a biophysical simulation model, the risk management benefits of federal crop insurance and supplemental irrigation are derived and compared to uninsured rainfed crop production in an expected utility framework. Federal crop insurance programs are inefficient at reducing producer exposure to weather-related production risk in humid regions, and the risk management benefits from supplemental irrigation are found to be scale and technology dependent. Environmental policies that regulate resource development will increase the investment cost of irrigation alternatives and reduce economic feasibility.

scholarly journals Agricultural Risk Management Using Fuzzy TOPSIS Analytical Hierarchy Process (AHP) and Failure Mode and Effects Analysis (FMEA)

Agriculture ◽  
2020 ◽  
Vol 10 (11) ◽  
pp. 504
Author(s):  
Peyman Zandi ◽  
Mohammad Rahmani ◽  
Mojtaba Khanian ◽  
Amir Mosavi
Keyword(s):  
Risk Assessment ◽  
Risk Management ◽  
Failure Mode ◽  
Analytical Hierarchy Process ◽  
Failure Modes ◽  
Fuzzy Topsis ◽  
Control Measures ◽  
Management Tool ◽  
Agricultural Risk ◽  
Hierarchy Process

Failure mode and effects analysis (FMEA) is a popular technique in reliability analyses. In a typical FMEA, there are three risk factors for each failure modes: Severity (S), occurrence (O), and detectability (D). These will be included in calculating a risk priority number (RPN) multiplying the three aforementioned factors. The literature review reveals some noticeable efforts to overcome the shortcomings of the traditional FMEA. The objective of this paper is to extend the application of FMEA to risk management for agricultural projects. For this aim, the factor of severity in traditional FMEA is broken down into three sub-factors that include severity on cost, the severity on time, and severity on the quality of the project. Moreover, in this study, a fuzzy technique for order preference by similarity to ideal solution (TOPSIS) integrated with a fuzzy analytical hierarchy process (AHP) was used to address the limitations of the traditional FMEA. A sensitivity analysis was done by weighing the risk assessment factors. The results confirm the capability of this Hybrid-FMEA in addressing several drawbacks of the traditional FMEA application. The risk assessment factors changed the risk priority between the different projects by affecting the weights. The risk of water and energy supplies and climate fluctuations and pests were the most critical risk in agricultural projects. Risk control measures should be applied according to the severity of each risk. Some of this research’s contributions can be abstracted as identifying and classifying the risks of investment in agricultural projects and implementing the extended FMEA and multicriteria decision-making methods for analyzing the risks in the agriculture domain for the first time. As a management tool, the proposed model can be used in similar fields for risk management of various investment projects.

scholarly journals Factors Affecting Farmers' Utilization of Agricultural Risk Management Tools: The Case of Crop Insurance, Forward Contracting, and Spreading Sales

2009 ◽  
Vol 41 (1) ◽  
pp. 107-123 ◽  
Author(s):  
Margarita Velandia ◽  
Roderick M. Rejesus ◽  
Thomas O. Knight ◽  
Bruce J. Sherrick
Keyword(s):  
Risk Management ◽  
Crop Insurance ◽  
Probit Analysis ◽  
Farm Income ◽  
Multinomial Probit ◽  
Agricultural Risk ◽  
Management Tools ◽  
Factors Affecting ◽  
Adoption Decisions ◽  
Forward Contracting

Factors affecting the adoption of crop insurance, forward contracting, and spreading sales are analyzed using multivariate and multinomial probit approaches that account for simultaneous adoption and/or correlation among the three risk management adoption decisions. Our empirical results suggest that the decision to adopt crop insurance, forward contracting, and/or spreading sales are correlated. Richer insights can be drawn from our multivariate and multinomial probit analysis than from separate, single-equation probit estimation that assumes independence of adoption decisions. Some factors significantly affecting the adoption of the risk management tools analyzed are proportion of owned acres, off-farm income, education, age, and level of business risks.

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