scholarly journals PENDEKATAN OPSI CASH-OR-NOTHING UP AND IN BARRIER UNTUK PENENTUAN NILAI PREMI ASURANSI PERTANIAN

2020 ◽  
Vol 4 (3) ◽  
pp. 557-565
Author(s):  
Yunita Wulan Sari ◽  
Gunardi Gunardi
Keyword(s):  
Crop Insurance ◽  
Extreme Rainfall ◽  
Barrier Option ◽  
Crop Failure ◽  
Insurance Premiums ◽  
Rainfall Index ◽  
Limit Value ◽  
Black Scholes ◽  
Negative Effect ◽  
Approach Method

Crop insurance is a type of insurance that provides protection to farmers who hold an insurance policy for losses due to crop failure. Extreme weather, especially rainfall, has been the main cause of the crop failure. Therefore, the type of crop insurance based on weather or rainfall must be developed and applied. This paper will discuss the cash-or-nothing up and in barrier option approach for determining insurance premiums where the risk of loss in terms of high rainfall, then compare it to the Black-Scholes option approach. In this approach, the claim limit is based on the rainfall index and the value of the barrier is determined according to the size of the extreme rainfall. We use cumulative rainfall data in the first subround in Sleman regency as a case study. The conclusions obtained are barrier value has a negative effect on the value of insurance premiums and claim limit value has a positive effect. Besides the premium value with this barrier option approach is cheaper than the Black-Scholes option approach, this approach method more interesting to apply because of the barrier value addition.

scholarly journals PENENTUAN NILAI PREMI ASURANSI PERTANIAN BERBASIS INDEKS CURAH HUJAN PADA KOMODITAS KEDELAI YANG DISIMULASI MENGGUNAKAN DISTRIBUSI WEIBULL

2020 ◽  
Vol 9 (4) ◽  
pp. 257
Author(s):  
NI PUTU AYUNDA SURYA DEWI ◽  
KOMANG DHARMAWAN ◽  
KARTIKA SARI
Keyword(s):  
Insurance Premium ◽  
Weather Generator ◽  
Rainfall Data ◽  
Simulated Rainfall ◽  
Crop Failure ◽  
Agricultural Insurance ◽  
Stochastic Weather Generator ◽  
Insurance Premiums ◽  
Rainfall Index ◽  
Insurance Costs

Agricultural insurance protects farmers who experience crop failure. This study aims to calculate the value of agricultural insurance premium by applying simulated rainfall index-based using stochastic weather generator on soybean commodities in Negara sub-district. This study are used rainfall data to determine the probability of the transition, then perform rainfall simulations using the Stochastic Weather Generator method to obtain trigger values and continued with the calculation of agricultural insurance premiums. Results of this study provide the value that higher trigger is taken, the greater the insurance premium that must be paid. The value of insurance premiums to be paid is 4,18% - 5,66% of insurance costs Rp2.605.000,00.

Information technology and insurance development in Sub-Saharan Africa

2021 ◽  
pp. 026666692110289
Author(s):  
Taiwo Akinlo
Keyword(s):  
Information Technology ◽  
Mobile Phone ◽  
Life Insurance ◽  
Sub Saharan Africa ◽  
Method Of Moment ◽  
African Countries ◽  
Insurance Premiums ◽  
Negative Effect ◽  
Sub Saharan ◽  
Insurance Development

The study examined the relationship between information technology and insurance development in 40 sub-Saharan African countries during the period 2000-2017. The study employed System Generalised Method of Moment for the estimations. Life insurance premiums, non-life insurance premiums and total insurance premiums are used to measure life insurance, non-life insurance and total insurance, respectively. The information technology is measured by mobile phone, fixed telephone and Internet penetrations. The study found that the Internet promotes non-life insurance while its effect on life and total insurance is insignificant. The mobile phone produced a negative effect on life insurance, non-life insurance and total insurance. However, fixed telephone significantly contributed to life insurance, non-life insurance and total insurance. Based on these findings, there is a need for insurers to encourage their client to use information technology tools for insurance activities and also increase their interaction with their customers.

scholarly journals Estimation of the Amount of Rice Crop Insurance Premium in the Citarum River Basin

2020 ◽  
Vol 1 (1) ◽  
pp. 33-39
Author(s):  
Nurfadhlina Abdul Hali ◽  
Muhammad Faiz Rifqi ◽  
Endang Soeryana
Keyword(s):  
River Basin ◽  
Crop Insurance ◽  
Crop Productivity ◽  
Insurance Premium ◽  
Rice Crop ◽  
Normal Curve ◽  
Mathematical Methods ◽  
Insurance Premiums ◽  
Productivity Data ◽  
Curve Method

Determination of crop insurance premiums in the Citarum River basin can be calculated by mathematical methods. One of the methods of calculation of the premium that is the normal curve methods with data on crop productivity is assumed to be Gaussian. In this thesis are discussed in crop insurance premium calculations Areas Citarum River basin West Bandung Regency with normal curve method with a significant level of coverage. These methods are used because data on crop productivity gained Gaussian. Normal curve method is used without using the assumption of coefficients of variation, and try for some level of coverage. Application materials used are rice crop productivity data in the Citarum River basin of West Bandung Regency in 2008-2014. This research resulted in the value of the rice crop insurance premiums for farmers in the area based on a certain level of coverage.

SPECTRALLY ACCURATE OPTION PRICING UNDER THE TIME-FRACTIONAL BLACK–SCHOLES MODEL

2021 ◽  
pp. 1-21
Author(s):  
GERALDINE TOUR ◽  
NAWDHA THAKOOR ◽  
DÉSIRÉ YANNICK TANGMAN
Keyword(s):  
Finite Difference ◽  
Option Pricing ◽  
Time Discretization ◽  
Finite Difference Approximation ◽  
Difference Approximation ◽  
Spectral Approximation ◽  
Barrier Option ◽  
Order Accuracy ◽  
Black Scholes ◽  
Richardson Extrapolation Method

Abstract We propose a Legendre–Laguerre spectral approximation to price the European and double barrier options in the time-fractional framework. By choosing an appropriate basis function, the spectral discretization is used for the approximation of the spatial derivatives of the time-fractional Black–Scholes equation. For the time discretization, we consider the popular $L1$ finite difference approximation, which converges with order $\mathcal {O}((\Delta \tau )^{2-\alpha })$ for functions which are twice continuously differentiable. However, when using the $L1$ scheme for problems with nonsmooth initial data, only the first-order accuracy in time is achieved. This low-order accuracy is also observed when solving the time-fractional Black–Scholes European and barrier option pricing problems for which the payoffs are all nonsmooth. To increase the temporal convergence rate, we therefore consider a Richardson extrapolation method, which when combined with the spectral approximation in space, exhibits higher order convergence such that high accuracies over the whole discretization grid are obtained. Compared with the traditional finite difference scheme, numerical examples clearly indicate that the spectral approximation converges exponentially over a small number of grid points. Also, as demonstrated, such high accuracies can be achieved in much fewer time steps using the extrapolation approach.

Particulate Matter in Ambient Air

2007 ◽  
Vol 4 (4) ◽  
pp. 278-288 ◽  
Author(s):  
Reinhold Görgen ◽  
Udo Lambrecht
Keyword(s):  
Particulate Matter ◽  
Air Quality ◽  
Human Health ◽  
Ambient Air ◽  
Limit Values ◽  
Limit Value ◽  
European Institutions ◽  
Negative Effect ◽  
Time Extension ◽  
The Eu

AbstractNumerous studies have demonstrated the negative effect of particulate matter on human health. The EU therefore introduced ambitious limit values for particulate matter (PM10) in ambient air as early as 1999: an annual limit and a daily limit that can be exceeded on up to 35 days a year. These values are binding since 2005. The daily limit is still exceeded in many cities throughout Europe. Heated debates on the future of the daily limit are taking place at all levels of the EU in the context of the negotiations on the Commission's proposal on a new Air Quality Directive. Suggestions range from allowing a compliance time extension to increasing the number of days the daily limit can be exceeded, and abolition of the daily limit value. The deliberations have not yet been concluded, but the decisive European institutions have voiced support for keeping the daily limit while at the same time extending the compliance deadline. In this article, we will make the point that the problem can most probably be solved by allowing a compliance extension of around 5 years after the new directive enters into force. This would give the competent local authorities and the EU the time necessary to intensify their measures in order to comply with the daily limit in most areas where it is currently exceeded. An increase in the number of days the limit values may be exceeded, as called for by the European Parliament (EP), would therefore amount to an unnecessary lowering of the limit value.

Implications of within county yield heterogeneity for modeling crop insurance premiums

2012 ◽  
Vol 72 (1) ◽  
pp. 134-155 ◽  
Author(s):  
Joseph Cooper ◽  
Carl Zulauf ◽  
Michael Langemeier ◽  
Gary Schnitkey
Keyword(s):  
Crop Insurance ◽  
Insurance Premiums

Introduction of the trend-adjusted crop insurance program

2017 ◽  
Vol 77 (3) ◽  
pp. 412-428 ◽  
Author(s):  
HongSeok Seo ◽  
Taehoo Kim ◽  
Man-Keun Kim ◽  
Bruce A. McCarl
Keyword(s):  
Crop Insurance ◽  
Data Set ◽  
Content Type ◽  
Yield Level ◽  
Before And After ◽  
Production History ◽  
Negative Effect ◽  
Risk Protection ◽  
The Individual ◽  
Changes Over Time

Purpose Recently, USDA-RMA introduced a Trend Adjusted-Actual Production History (TA-APH) program, which increases APH by a trend factor to cover yield changes over time. The purpose of this paper is to examine the effects of the TA-APH program on farmer participation, coverage election, and risk by analyzing data before and after the program. Design/methodology/approach Since the program was carried out in selected counties, the authors employ a difference in differences approach doing comparisons of insurance participation and coverage levels between eligible and ineligible counties. Findings The authors find that farmers within the counties where the TA-APH program was available experienced an increase in insured acres of 3 percent for corn and 5 percent for soybeans. The authors also find the farmers eligible for the program purchased lower coverage levels relative to those not eligible. However, the magnitude of that negative effect is relatively small, −0.9 percent in corn and −1.3 percent in soybeans. Collectively the evidence shows the TA-APH program does increase the guaranteed yield level mitigating farmer risk. Research limitations/implications The data set used only permitted analysis at the county level, thus the authors could not look at the individual farmer choices. Practical implications The results suggest that if a greater level of farmer risk protection is desired from crop insurance, the authors find that the trend adjustment as implemented was a successful way to achieve this. Originality/value This paper contributes to the literature on the crop insurance by evaluating the program controlling for a non-participating groups, farming experience, liability rates, and subsidy rates. In doing this, it fulfills an identified need to study the actual impact on participation rates and coverage levels elected.

scholarly journals Rice crop insurance in Indonesia: adaptation to climate and farm production support

2021 ◽  
Vol 892 (1) ◽  
pp. 012076
Author(s):  
D Kusumaningrum ◽  
K Aldyan ◽  
V A Sutomo ◽  
D Saraswati ◽  
G Ariyan ◽  
...  
Keyword(s):  
Crop Insurance ◽  
Group Discussion ◽  
Rice Crop ◽  
Insurance Companies ◽  
Integration Scheme ◽  
Insurance Premiums ◽  
Local Agriculture ◽  
Financing Costs ◽  
Loan Risk ◽  
The Government

Abstract Indonesia’s Rice Crop Insurance (AUTP) scheme has successfully protected farmers from significant crop losses due to natural disasters. However, the current amount of AUTP’s compensation is still unable to accommodate farmer’s financing costs (i.e., unpaid micro-loan and its interests) to support crops production. This results in higher micro-loan risk and hinder the sustainability of farming enterprises. In this regard, the existing People’s Business Credit (KUR) should supposedly be accessible as a micro-loan source to help farmers fund their farms. This study has two objectives: (1) formulate an integration scheme between KUR and AUTP, and (2) determine the appropriate insurance premiums to meet the farmer’s operational and financing costs. This research used 100,000 Monte Carlo Simulations using lognormal distributions with assumptions based on the results of focus group discussion and in-depth interviews with farmer groups, the local Agriculture Service, and micro-loan distributors, as well as the data from the Ministry of Agriculture from the period of 2018–2020. Additionally, Individual Area Yield Index (I-AYI) policy and loss ratio is used to determine and evaluate the new integrated crop insurance premiums. The study revealed that the farmers expect affordable, accessible, and beneficial insurance products with premium subsidies bundled with KUR. Therefore, the government should develop an integration of crop insurance with KUR and determine the affordable premium calculations along with the insurance companies. Based on the simulation results, the total pure premium is estimated around IDR 1 million for a minimum KUR loan of IDR 8 million (suitable for farming costs).

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