Systemic Risk in U.S. Crop Reinsurance Programs
AbstractThis study develops a method to estimate the probability density function of the Federal Risk Management Agency's (RMA's) net income from reinsuring crop insurance for corn, wheat, and soybeans. When calibrated using 1997 data, results from the advocated method show that in 1997 there was a 5% probability RMA would have had to reimburse at least $1 billion to insurance companies, and the fair value of RMA's insurance services to insurance firms in 1997 was $78.7 million. Key words: crop insurance, reinsurance, Risk Management Agency, systemic risk, value at risk
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Bibliographic InfoPaper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 1944.
Date of creation: 01 Apr 2003
Date of revision:
Publication status: Published in Agricultural Finance Review, Spring 2003, vol. 63 no. 1, pp. 23-39
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Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070
Phone: +1 515.294.6741
Fax: +1 515.294.0221
Web page: http://www.econ.iastate.edu
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This paper has been announced in the following NEP Reports:
- NEP-AGR-2002-10-27 (Agricultural Economics)
- NEP-ALL-2002-08-16 (All new papers)
- NEP-IAS-2002-08-08 (Insurance Economics)
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