Remote Sensing Application in Pure Premium Rate-Making of Winter Wheat Crop Insurance

Crop insurance is a crucial way to avoid disaster losses and to guarantee farmers’ basic production income in China and abroad. Securing agricultural production is a critical way to eradicate hunger and reduce poverty and an essential means to achieve the UN Sustainable Development Goals. How to pay...

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Bibliographic Details
Published in:Sustainability 2023-04, Vol.15 (9), p.7133
Main Authors: Wang, Weijia, Wang, Wen, Wang, Kun, Zhao, Yanyun, Yu, Ran
Format: Article
Language:English
Subjects:
Agricultural production
Agriculture
Anniversaries
Biomass
Cereal crops
China
Crop insurance
Crops
Farmers
Hunger
Insurance
Insurance industry
Insurance premiums
Land area
Natural disasters
Poverty
Remote sensing
Sustainable development
Vegetation
Wheat
Wheat industry
Winter
Winter wheat
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Summary:Crop insurance is a crucial way to avoid disaster losses and to guarantee farmers’ basic production income in China and abroad. Securing agricultural production is a critical way to eradicate hunger and reduce poverty and an essential means to achieve the UN Sustainable Development Goals. How to pay out more quickly and fairly after a disaster has become an urgent issue for agricultural insurance. The standard domestic crop insurance rate is determined based on the statistical data of the entire administrative unit and ignores the spatial risk difference of disasters inside the administrative unit. Therefore, obtaining a pure premium based on crops inside the administrative unit is a key problem. Based on remote sensing data and insurance actuarial models, we studied and determined the fair premium rates to insure winter wheat at the farmer level in Heze, Shandong, China. Our study shows that remote sensing data can provide data security for determining a pure premium rate at the level of individual farms, and provide the primary reference for determining farmer-level crop insurance premium rates. The use of remote sensing for determining those rates can improve the customization of crop insurance and reduce farmers’ lower incomes due to exposure to natural disasters, improve farmers’ resilience to risk, and prevent a return to poverty due to disasters, ultimately reaching the UN Sustainable Development goals of eradicating hunger and reducing poverty.
ISSN:2071-1050
2071-1050
DOI:10.3390/su15097133