Livestock and aquaculture insurance in developing countries PDF
Preview Livestock and aquaculture insurance in developing countries
Livestock and aquaculture insurance in developing countries Livestock and AGRICULTURFAALO SERVICES aquaculture insurance BULLETIN in developing countries 164 by R.A.J.Roberts FOODANDAGRICULTUREORGANIZATIONOFTHEUNITEDNATIONS Rome.2007 Thedesignationsemployedandthepresentationofmaterial inthisinformationproductdonotimplytheexpressionofany opinionwhatsoeveronthepartoftheFoodandAgriculture OrganizationoftheUnitedNationsconcerningthelegalor developmentstatusofanycountry,territory,cityorareaorof itsauthorities,orconcerningthedelimitationofitsfrontiers orboundaries. ISBN978-92-5-105675-2 Allrightsreserved.Reproductionanddisseminationofmaterialinthisin- formationproductforeducationalorothernon-commercialpurposesare authorizedwithoutanypriorwrittenpermissionfromthecopyrightholders providedthesourceisfullyacknowledged.Reproductionofmaterialinthis informationproductforresaleorothercommercialpurposesisprohibited withoutwrittenpermissionofthecopyrightholders.Applicationsforsuch permissionshouldbeaddressedtotheChief,ElectronicPublishingPolicy andSupportBranch,CommunicationDivision,FAO,VialedelleTermedi Caracalla,00153Rome,[email protected] ©FAO2007 Copyrightedmaterial Livestockandaquacultureinsuranceindevelopingcountries iii Contents Acronyms ix Acknowledgements xi Chapter1 INTRODUCTION 1 1.1 Purposeofthispublication 1 1.2 Targetreadership 3 1.3 Importanceoflivestockandaquacultureproducts 4 Demand 4 Supply(production) 5 Chapter2 PERILS/RISKSFACINGLIVESTOCKAND AQUACULTUREFARMERS 9 ?1 Thediscussionfocus 9 2,2 Marketrelatedrisks 9 2,3 Non-marketrelatedrisks 10 Group1 Healthfactors 11 Group2Climateandseismicevents 11 Group3Accidents 11 Group4Infrastructureandenvironmentalproblems 11 Group5Managementissues 12 Group6Consequentiallosses 12 Thls One 3FFV-QRP-BRQL IV Contents Chapter3 MANAGEMENTOFTHESERISKS 13 3.1 Policy-basedriskmanagement 13 Sitelicensing 13 Quarantinereguirements 14 Compulsoryveterinaryprocedures 15 3.2 On-farmriskmanagement 16 Group1 Healthfactors 16 Group2Climateandseismicevents 17 Group3Accidents 18 Group4Infrastructureandenvironmentalproblems 18 Group5Managementissues 20 Group6Conseguentiallosses 21 3.3 Financially-basedriskmanagementmechanisms 21 Introduction 21 Sharedownership/farmingpartnerships/production cooperatives 22 Islamicbanking 23 Marketingarrangements 23 Insurance-introduction 24 Chapter4 INSURANCEINPRACTICE 25 41 LivestockinsuranceinIndia 25 Publicsectorlivestockinsurance 25 Privatesectorlivestockinsurance(example,BASIX) 26 4.2 AguacultureinsuranceinIran 28 General 28 Insurancecoverageandresults 28 4.3 Briefnotesonlivestockandaguacultureinsurance experience 30 Argentina 30 Bangladesh 30 Copyrightedmaterial Livestockandaquacultureinsuranceindevelopingcountries V Brazil 2D Chile 2Q Ecuador 3D RepublicofKorea 31 Mexico 21 Panama 31 VietNam 21 Chapter5 INSURANCEAPPROACHES: STEPSINTHEDEVELOPMENTPROCESS 33 5.1 Decisionandactionsteps 33 52 Demandassessment 25 5.3 Natureoftheinsuredparties-automaticorvoluntarycover? 36 5.4 Approachestolivestockandaquacultureinsurance 37 5.5 Indexapproachestoinsurance 41 Theconcept 41 Weatherindexinsurance 41 Non-weatherindexinsurance 43 Indexinsurance:thewayofthefuture? 45 Chapter6 RISKSTHATMAYBEMANAGED,ATLEAST PARTIALLY,BYUSINGINSURANCE 47 6J Diseaselosses 41 6.2 Climateperils 49 Drought 49 Windstorm 52 Freeze 54 Flood 54 6.3 Otherperils 56 Seismicandvolcanicevents 56 Eire 56 Copyrightedmaterial VI Contents Theftandpredation 56 Waterquality 57 Accidents 58 Consequentialloss 59 Managementissues 59 Chapter7 HOWDOESINSURANCERELATETOVARIOUS TYPESOFENTERPRISE? 61 7.1 Benefit/costissues 61 7.2 Intensivelivestockenterprises 62 7.3 Traditionalmixedfarmingsystems 63 7.4 Extensivelivestockranchinqsystems 64 7.5 Aquaculture-sea/lakecagesystems 64 7.6 Aquaculture-pondsystems 65 7.7 Aquaculture-recirculationsystems 66 Chapter8 INSURANCEADMINISTRATION 67 81 Lossassessmentissues 67 82 Costcontainment 68 8.3 Marketidentificationandproductdevelopment 68 8.4 Marketinq 70 8.5 Settingindemnityandpremiumlevels; valuation;deductibles 71 8.6 Collectingpremiums 72 8.7 Handlingclaims 73 8.8 Rolesforgovernmentandtheprivatesector 73 Copyrightedmaterial Livestockandaquacultureinsuranceindevelopingcountries vii Tables Table1:Trendsinannualpercapitaconsumption ofselectedlivestockfoodproducts(kg) 4 Table2:Annualglobalpercapitaconsumptionoffishfromcapture fisheriescomparedwithaquacultureproducts(kg) 5 Table3:LivestockinsuranceinIndia(publicsector) 26 Table4:Livestockinsurance-Indianprivatesector(BASIX) 27 Table5:Iran-Aquacultureinsurance 29 Table6:Iran-Aquacultureinsurancelossratios 29 Figure Figure1:Global2004productionvaluesforcrop, livestockandaquaculture 6 Annexes I Listofreferences 79 II Noteonpremiumcalculations 81 III Countrieswhereaquacultureinsurance isorhasbeenavailable 83 IVExamplesoflivestockinsuranceproposalforms 85 V Glossaryofcommontermsusedincrop,livestock andaquacultureinsurance 97 Copyrightedmaterial Livestockandaquacultureinsuranceindevelopingcountries IX Acronyms APIF AgriculturalProductsInsuranceFund(Iran) BSE Bovinespongiformencephalopathy CRMG CommodityRiskManagementGroup,implementingagencyinthe WorldBankfortheInternationalTaskForceonCommodityRisk Management EU EuropeanUnion FMD Footandmouthdisease FAO FoodandAgricultureOrganizationoftheUnitedNations FIRI InlandWaterResourcesandAquacultureSendee,Fisheries ResourcesDivision.FoodandAgricultureOrganizationofthe UnitedNations GDP GrossDomesticProduct GIC GeneralInsuranceCorporation(India) ICAR InternationalCommitteeforAnimalRecording IFPRI InternationalFoodPolicyResearchInstitute ILRI InternationalLivestockResearchInstitute L/R Lossratio-seeentryinGlossary NOAA NationalOceanicandAtmosphericAdministration(USA) NDVI Normalizeddifferencevegetativeindex(seealsoentryinGlossary) OIE Officeinternationaldesepizooties(WorldOrganisationforAnimal Health) TAD Transboundaryanimaldisease TSI Totalsuminsured UN UnitedNations Copyrightedmaterial Livestockandaquacultureinsuranceindevelopingcountries XI Acknowledgements Theauthorishappytoacknowledgehisdebttothemanypractitionersand specialistsinthefieldsoflivestockandaquaculture,andintheapplicationof insurancetothemanagementoftheserisks,withwhomliehasworkedor correspondedovertheyears,andwhohavepassedonfreelytheirknowledge andadvice. Thenumbersinvolvedaremany,butspecialmentionshouldbemadeofthe assistanceandadvicegivenbythefollowing:JohnBostock,GrahamCoates, WilliamDick,CarlosEddi,ErichKasten,ChrisKennedy,JiaJiansan,Juhani Miiki-Hokkonen,lanMacandrcw,RockyNys,AkeOlofsson,JuhaniSalmincn, Paddy Secretan, Jerry Skccs, Charles Stutley, Rohana Subasinghe, Tore Thorscn,andRaymonVanAnrooy. Ofthoselistedabove,theauthorisespeciallyindebtedto,WilliamDick, CarlosEddi,CharlesStutley,RohanaSubasingheandRaymonvanAnrooy,all ofwhomreadanearlierversionofthistextandprovidedvaluablecomments, correctionsandamplifications. Noneofthesespecialists,noranypersonotherthantheauthor,shouldbe heldresponsibleforanyinaccuraciesorerroneousopinionsthatremaininthe publication. Copyrightedmaterial
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