Research Reports
A Study on the Computation of Standard Yields and Establishment of Claims Adjustment Method for Chestnut Insurance Program
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AuthorLee, Sangmin
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Publication Date2006.12.01
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Original
Chestnuts had been one of the most profitable crops for a couple of decades. More than fifty thousand farmers were engaged in production during the period. The production amount of 2003, however, decreased and the chestnut industry showed signs of stagnating. The consecutive typhoons which broke out in 2002 and 2003 were considered as the main reason of its dullness. It is strongly required to bring in the crop insurance program for the chestnut to compensate for the loss of profits due to the natural disasters.
This study focuses on estimation of the standard yields and setting-up of claims adjustment methods for the chestnut insurance program. Standard yields are the most important materials for the crop insurance program and it come to be bases of insured amount and premium. Stability of the program heavily depends on the accuracy of the yields.
Three different yearly production data were classified by age of trees for the main chestnut-producing provinces such as Gwangyang, Sanchung, and Gongju. Yearly amount of production for each age is averaged to make standard yield tables and graphs. No yield graphs reflect theoretical backgrounds, however.
The standard yield tables are revised to be possibly utilized for the insurance program. The several age classes are aggregated and their yields are averaged. The revision of the standard yield graphs seem to follow the configuration introduced at the references. Yield of chestnuts are regressed with respect to the degree of the management works of pruning, fertilizing and control of insects to find their contributions to the increase of yields. The results, however, should be confirmed through field studies, since the explanation abilities of data are very low.
Japanese system of claims adjustment is carefully studied to check its adoptability under our current situations. Three methods relevant to the chestnut insurance have their own strength and weakness at the same time. It is recommended to introduce them in accordance with time plan. The first method is to offset demage caused by all target casualties. The way of claims adjustment is relatively easy since no field survey is necessary to estimate losses. The premise to apply this method, however, is to restrict eligibility to those who circulates his/her products through a distributor such as a cooperative association and this would reduce the number of policyholder. Since the circulation rate of chestnut through the distributor is just about 70% of all, it should be considered under longest time plan after systemic revision of distribution channel. The second method is estimate the overall losses at a period of production. It is required, however, to have much more precise yield criteria to compare with the final yields. Since the standard yield tables provided in this study remain to be confirmed, this method can be considered under the middle time plan. The last one is the same with the one utilized in crop insurance program for apples, pears and etc. Since we have much experience it is relatively easy to adopt at once. The characteristics of chestnuts should be fully considered as it has been done in this study.
Researchers: Lee, Sang-Min, Kim, Eui-Gyeong and Chang, Cheol-Su
Research Period: 2006.6~2006.12
E-mail address: smlee@krei.re.kr
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