WIN Magazine - Summer 2012 - (Page 40)
Wholesale Insurance WHITE PAPER WINNERS
Risk Transfer Techniques for the American Wheat Farmer
BY KYLE RICHARD GUESTIN, UTICA COLLEGE – KRGUESTIN@UTICA.EDU
wheat prices. This paper is of interest to the agricultural sector of the property casualty industry and the exposures have grown more significant over time, in conjunction with fewer government subsidies. “Farmers, who are not gamblers by nature, are often forced by nature to gamble” (Subik 2008). As a farmer, you are at the mercy of the weather, and the demand of your product. With increasing costs, such as equipment, fertilizers, and pesticides, farmers need to have a risk management plan to protect themselves. The most common technique is transferring these risks to a third
HE AAMGA EDUCATION Foundation issues a call for white papers each spring, inviting college and university students across the United States engaged in risk management and insurance programs to submit research papers on topical issues impacting the industry. Two papers are selected – based on the soundness of industry knowledge, usefulness to other members of the wholesale insurance industry and innovation and creativity – by a panel of insurance professionals. Winners receive a monetary scholarship and are invited to attend the AAMGA Annual Meeting, held May 6-9, 2012 at the J.W. Marriott Hill Country Resort in San Antonio, Texas. Abstracts of the winning papers are presented here, with complete copies on the AAMGA University’s website at http://www.aamga.org/node/3543.
The purpose of this paper is to explore the various alternative risk transfer techniques available to farmers. The two primary transfer techniques available to the agricultural sector include crop insurance policies and the derivatives markets. This paper identifies the advantages and disadvantages of crop insurance relative to derivative products. It also discusses the externalities of the primary sources of risk transfer to protect, conserve, and reduce the volatility in 4 0 | v i e w t h i s i s s u e a t | www.aamgawin.org
Table of Contents for the Digital Edition of WIN Magazine - Summer 2012
Another Liability Catastrophe in the Making?
The Economy and the Insurance Pricing Cycle 2012: When Good News is Bad News
Capitalizing on Supplementary Coverages: MPL & Excess/Umbrella Policies
Are Your Technology Solutions Enabling Your Business?
NRRA Implementation: What Lies Ahead for Wholesalers and Producers
State Taxation of Non-U.S. Risk Premium
Rick Transfer Techniques for the American Wheat Farmer
Cyber & Reputational Risk Insurance: Past, Present, & Future
In the WIN-ner’s Circle
INDEX TO ADVERTISERS/ ADVERTISERS.COM
WIN Magazine - Summer 2012