Publication: The Agricultural Insurance Market in the Caribbean
Arias Carballo, Diego
dos Reis, Laura
Agricultural insurance is a tool to manage agricultural production risks and help producers reduce the effects of negative shocks and improve the allocation of resources. It provides a mechanism to transfer a variety of risks faced by crop, livestock, forestry, or aquaculture production. The small island nations of the Caribbean are highly exposed to tropical cyclones, hurricanes, and other weather hazards-and are particularly vulnerable to drastic losses from natural disasters. A single catastrophic event can affect a large proportion of clients, and this is often reflected in the insurance premiums charged by local insurance companies, especially if they only underwrite risk in one or a few neighboring islands (as is common in the Caribbean). To be able to pay many claims all at once, insurers must either purchase their own insurance (re-insurance), which is expensive, due to the high exposure to extreme weather events, or hold a large amount of cash reserves. The development of market-based agricultural insurance options in the Caribbean can range from regional and macro-level applications (sector, country, or groups of countries) to the micro-level (farmers).
Link to Data Set
“Arias Carballo, Diego; dos Reis, Laura. 2013. The Agricultural Insurance Market in the Caribbean. En breve;no. 183. © World Bank, Washington, DC. http://hdl.handle.net/10986/17030 License: CC BY 3.0 IGO.”