EconPapers    
Economics at your fingertips  
 

Can Crop Insurance Premiums Be Reliably Estimated?

Octavio Ramirez, Carlos Carpio () and Roderick Rejesus

Agricultural and Resource Economics Review, 2011, vol. 40, issue 1, 14

Abstract: This paper develops and applies a methodology to assess the accuracy of historical loss-cost rating procedures, similar to those used by the U.S. Department of Agriculture’s Risk Management Agency (RMA), versus alternative parametric premium estimation methods. It finds that the accuracy of loss-cost procedures leaves much to be desired, but can be markedly improved through the use of alternative methods and increased farm-level yield sample sizes. Evidence suggests that the high degree of inaccuracy in crop insurance premium estimations through historical loss-cost procedures identified in the paper might be a major factor behind the need for substantial government subsidies to keep the program solvent.

Keywords: Agricultural and Food Policy; Agricultural Finance; Farm Management; Risk and Uncertainty (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12) Track citations by RSS feed

Downloads: (external link)
https://ageconsearch.umn.edu/record/107091/files/ramirez%20-%20current.pdf (application/pdf)

Related works:
Journal Article: Can Crop Insurance Premiums Be Reliably Estimated? (2011) Downloads
Working Paper: Can Crop Insurance Premiums be Reliably Estimated? (2009) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:arerjl:107091

DOI: 10.22004/ag.econ.107091

Access Statistics for this article

More articles in Agricultural and Resource Economics Review from Northeastern Agricultural and Resource Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().

 
Page updated 2022-09-28
Handle: RePEc:ags:arerjl:107091