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The Potential to Use Futures and Options to Manage Crop Insurance Losses

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  • Driedger, Jonathon
  • Porth, Lysa
  • Boyd, Milton

Abstract

Crop insurers have limited ability to manage the risk of losses once premiums are set and farmers have taken out their policies. Any additional instruments that enhance the ability for insurers to reduce their risk between when premiums are set and final yields are determined can help manage potential losses. The relationship between crop insurance losses and changes in futures prices are examined, and whether there is the potential to hedge crop insurance losses with grain futures contracts.

Suggested Citation

  • Driedger, Jonathon & Porth, Lysa & Boyd, Milton, 2016. "The Potential to Use Futures and Options to Manage Crop Insurance Losses," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235747, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea16:235747
    DOI: 10.22004/ag.econ.235747
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    References listed on IDEAS

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    5. Kim, Seon-Woong & Brorsen, B. Wade & Yoon, Byung-Sam, 2014. "Optimal Cross Hedging Winter Canola," 2014 Annual Meeting, February 1-4, 2014, Dallas, Texas 162428, Southern Agricultural Economics Association.
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    Keywords

    Agricultural Finance; Risk and Uncertainty;

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