...Rui Zhou; Johnny Siu-Hang Li; Jeffrey Pai Purpose The purpose of this paper is to examine the reduction of crop yield uncertainty using rainfall index insurances. The insurance payouts are determined by a transparent rainfall index rather than actual crop yield of any producer, thereby...

...Rui Zhou; Johnny Siu-Hang Li; Jeffrey Pai Purpose – The application of weather derivatives in hedging crop yield risk is gaining more interest. However, the further development of weather derivatives – particularly exchange-traded – in the agricultural sector has been impeded by concerns over...

... Agriculture Crops Insurance premiums Copulas Corn Crop yield Federal crop insurance Monte Carlo simulation Multivariate density functions Soybeans Accurate pricing of insurance is central to reducing adverse selection and encouraging insurance program participation in a cost‐effective manner...