IDEAS home Printed from https://ideas.repec.org/a/beo/journl/v65y2020i224p83-100.html
   My bibliography  Save this article

Parametric Crop Insurance Against Floods: The Case Of Bosnia And Herzegovina

Author

Listed:
  • Bojan Baškot
  • Stanko Stanić

Abstract

The importance of risk man-agement in agriculture is unquestionable. Farmers in Bosnia and Herzegovina face weather, product, and price and market risk. Index-based insurance products for agriculture present alternatives for man-aging weather risk. They differ from clas-sical insurance products in that they do not remunerate actual loss and to purchase a weather index insurance policy the insured does not actually have to have an insurable interest. In this research, two flood para-metric insurance products are presented, one with fixed compensation and the other with compensation proportional to flood intensity.

Suggested Citation

  • Bojan Baškot & Stanko Stanić, 2020. "Parametric Crop Insurance Against Floods: The Case Of Bosnia And Herzegovina," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 65(224), pages 83-100, January –.
    • Handle: RePEc:beo:journl:v:65:y:2020:i:224:p:83-100
    as

    Download full text from publisher

    File URL: http://www.ekof.bg.ac.rs/wp-content/uploads/2014/04/637_NOVO-1.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Alma Cohen & Peter Siegelman, 2010. "Testing for Adverse Selection in Insurance Markets," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 77(1), pages 39-84, March.
    2. Eduardo M. Azevedo & Daniel Gottlieb, 2017. "Perfect Competition in Markets With Adverse Selection," Econometrica, Econometric Society, vol. 85, pages 67-105, January.
    3. Marc Gürtler & Martin Hibbeln & Christine Winkelvos, 2016. "The Impact of the Financial Crisis and Natural Catastrophes on CAT Bonds," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 83(3), pages 579-612, September.
    4. Kumar, D. Suresh & Barah, B.C. & Ranganathan, C.R. & Venkatram, R. & Gurunathan, S. & Thirumoorthy, S., 2011. "An Analysis of Farmers’ Perception and Awareness towards Crop Insurance as a Tool for Risk Management in Tamil Nadu," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 24(1), June.
    5. Black, Fischer & Scholes, Myron S, 1973. "The Pricing of Options and Corporate Liabilities," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 637-654, May-June.
    6. Sommarat Chantarat & Christopher B. Barrett & Andrew G. Mude & Calum G. Turvey, 2007. "Using Weather Index Insurance to Improve Drought Response for Famine Prevention," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(5), pages 1262-1268.
    7. Robert W. Klein & Shaun Wang, 2009. "Catastrophe Risk Financing in the United States and the European Union: A Comparative Analysis of Alternative Regulatory Approaches," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 76(3), pages 607-637, September.
    8. Mario J. Miranda, 1991. "Area-Yield Crop Insurance Reconsidered," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(2), pages 233-242.
    9. Skees, Jerry & Hazell, P. B. R. & Miranda, Mario, 1999. "New approaches to crop yield insurance in developing countries:," EPTD discussion papers 55, International Food Policy Research Institute (IFPRI).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Stoeffler, Quentin & Opuz, Gülce, 2022. "Price, information and product quality: Explaining index insurance demand in Burkina Faso," Food Policy, Elsevier, vol. 108(C).
    2. Muamba, Francis M. & Ulimwengu, John M., 2010. "Optimal rainfall insurance contracts for maize producers in Ghana’s Northern Region," IFPRI discussion papers 1016, International Food Policy Research Institute (IFPRI).
    3. Glauber, Joseph W., 2017. "Agricultural insurance and the WTO:," IFPRI book chapters, in: Bouët, Antoine & Laborde Debucquet, David (ed.), Agriculture, development, and the global trading system: 2000– 2015, chapter 10, International Food Policy Research Institute (IFPRI).
    4. Alexis Berg & Philippe Quirion & Benjamin Sultan, 2009. "Weather-index drought insurance in Burkina-Faso: assessment of its potential interest to farmers," Post-Print hal-00520893, HAL.
    5. Nathaniel Hendren & Camille Landais & Johannes Spinnewijn, 2021. "Choice in Insurance Markets: A Pigouvian Approach to Social Insurance Design," Annual Review of Economics, Annual Reviews, vol. 13(1), pages 457-486, August.
    6. Shih-Chieh Liao & Shih-Chieh Chang & Tsung-Chi Cheng, 2021. "Managing the Volatility Risk of Renewable Energy: Index Insurance for Offshore Wind Farms in Taiwan," Sustainability, MDPI, vol. 13(16), pages 1-27, August.
    7. Bokusheva, Raushan, 2010. "Measuring the dependence structure between yield and weather variables," MPRA Paper 22786, University Library of Munich, Germany.
    8. Turvey, Calum G., 1999. "Weather Insurance, Crop Production And Specific Event Risk," Working Papers 34101, University of Guelph, Department of Food, Agricultural and Resource Economics.
    9. Dissemin, uploaded via & Berg, Alexis & Quirion, Philippe & Sultan, Benjamin, 2018. "Weather-index drought insurance in Burkina-Faso: assessment of its potential interest to farmers," OSF Preprints dsmqz, Center for Open Science.
    10. Antoine Leblois & Philippe Quirion, 2013. "Agricultural insurances based on meteorological indices: realizations, methods and research challenges," Post-Print hal-00656778, HAL.
    11. Keith Marzilli Ericson & Philipp Kircher & Johannes Spinnewijn & Amanda Starc, 2021. "Inferring Risk Perceptions and Preferences Using Choice from Insurance Menus: Theory and Evidence," The Economic Journal, Royal Economic Society, vol. 131(634), pages 713-744.
    12. Kemeze, Francis H. & Miranda, Mario J. & Kuwornu, John & Amin-Somuah, Henry, 2016. "Optimal Management of Runoff Reservoir Supply: The Case of Tono Reservoir in Northern Ghana," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236030, Agricultural and Applied Economics Association.
    13. Patrick S. Ward & David L. Ortega & David J. Spielman & Neha Kumar & Sumedha Minocha, 2020. "Demand for Complementary Financial and Technological Tools for Managing Drought Risk," Economic Development and Cultural Change, University of Chicago Press, vol. 68(2), pages 607-653.
    14. Bokusheva, Raushan & Breustedt, Gunnar, 2012. "The Effectiveness of Weather-Based Index Insurance and Area-Yield Crop Insurance: How Reliable are ex post Predictions for Yield Risk Reduction?," Quarterly Journal of International Agriculture, Humboldt-Universitaat zu Berlin, vol. 51(2), pages 1-22, May.
    15. Bokusheva, Raushan & Breustedt, Gunnar & Heidelbach, Olaf, 2007. "Ex-ante evaluation of weather-based index insurance and area-yield insurance for reducing crop yield risk," 101st Seminar, July 5-6, 2007, Berlin Germany 9250, European Association of Agricultural Economists.
    16. Bokusheva, Raushan & Breustedt, Gunnar & Heidelbach, Olaf, 2006. "Measurement and Comparison of Risk Reduction by Means of Farm Yield, Area Yield, and Weather Index Crop Insurance Schemes - The Case of Kazakhstani Wheat Farms," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25523, International Association of Agricultural Economists.
    17. Turvey, Calum G., 1999. "Weather Derivatives And Specific Event Risk," 1999 Annual meeting, August 8-11, Nashville, TN 21550, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    18. Prokopchuk, Olina & Prokopchuk, Ihor & Mentel, Grzegorz & Bilan, Yuriy, 2020. "Parametric Insurance as Innovative Development Factor of the Agricultural Sector of Economy," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 10(3), September.
    19. Zant, Wouter, 2008. "Hot Stuff: Index Insurance for Indian Smallholder Pepper Growers," World Development, Elsevier, vol. 36(9), pages 1585-1606, September.
    20. Barnett, Barry J. & Barrett, Christopher B. & Skees, Jerry R., 2008. "Poverty Traps and Index-Based Risk Transfer Products," World Development, Elsevier, vol. 36(10), pages 1766-1785, October.

    More about this item

    Keywords

    catastrophic insurance; weather-index-based insurance; insurance premium;
    All these keywords.

    JEL classification:

    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:beo:journl:v:65:y:2020:i:224:p:83-100. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Goran Petrić (email available below). General contact details of provider: https://edirc.repec.org/data/efbeoyu.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.