Developing Rainfall-Based Index Insurance in Morocco

Skees, Jerry ; Gober, Stephanie ; Varangis, Panos ; Lester, Rodney ; Kalavakonda, Vijay

World Bank, Washington, DC

关键词: AGENTS;    AGRICULTURAL ECONOMICS;    AGRICULTURAL INSURANCE;    AGRICULTURAL LAND;    AGRICULTURAL PRODUCTION;   

DOI  :  10.1596/1813-9450-2577
RP-ID  :  WPS2577

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Cereal production accounts for aboutseventy percent of all agricultural land in Morocco. Cerealproducer prices, influenced by the government, are higherthan world prices. Production is divided into six broadagro-climatic zones. About half of cereal production isconcentrated in the favorable, and intermediate zones; therest occurs mostly in less favorable (arid and semi-arid)zones, with average annual rainfall below 450 millimeters.The authors assess the feasibility of rainfall-based indexinsurance, to provide effective, low-cost drought insurancefor Moroccan farmers, and rural dwellers. Their analysisfocuses on Morocco's three main cereal crops - hardwheat, soft wheat, and barley - using data on annualproduction, and planting from 1978-99. Maize is included insome of the analysis. The benefits of this program over thetraditional insurance scheme are that it minimizes the riskof moral hazard, and adverse selection, and promotes astreamlined pay-out-process. These features make the programmore attractive to international re-insurers, and investorsin capital markets. A rainfall-indexed insurance product isfeasible in Morocco, where the statistical correlationbetween rainfall, and cereal revenues is rather strong inseventeen provinces in the more favorable agro-climaticzones. Proportional rainfall insurance contracts, would paythe insured an amount based on the shortfall in actualrainfall, during a set period, compared with the triggerrainfall. The contracts could be purchased in any amount,allowing farmers to insure the full amount of their expectedrevenue, if they wish.