Agricultural risk management through crop insurance using geospatial technologies | |
| Author | Sinha, Shweta |
| Call Number | AIT Diss. no.RS-17-01 |
| Subject(s) | Agriculture--Risk management Insurance, Agricultural Geospatial data |
| Note | A dissertation submitted in partial fulfillment of the requirements for the degree of Doctor of PhilosophyinRemote Sensing & Geographic Information Systems |
| Publisher | Asian Institute of Technology |
| Series Statement | Dissertation ; no. RS-17-01 |
| Abstract | Crop insurance has significant potential to mitigate risks that individuals and countries are exposed to in light of rising disasters in Asia-Pacific region. The sector is a growth business areafor insurance and a much needed requirement for governments and individuals.To realize the potential, it is important that the ecosystem encouragesnew types of insurance productsthat is attractive to end users as well as providers.Although it is difficultto compare the demand and growth of crop insurance products in different countries, most of the developing countries are striving to adopt these products learningfrom the experiences of successful crop insurance deployment.The advancement of technology has provided an opportunity forthe insurance industry to transitionfrom traditional crop insurance to weather based crop insurance and/or satellite based crop insurance though there still existchallenges offeasibility, scalability and sustainability.While there is significant interest in crop insurance, basis risk remains a key challenge for the growth of weather index insurance (WII) products. Correlations between criticalparameters andyield hold the key for the development of the market. Analysis performed at province, district and farm level in Thailand indicated additional factors other than rainfall contributing to yield. DevelopingGeneralized Monsoon Index (GMI) maps indicated2012 as a severe drought year.Field based discussion withrice experts and farmers confirmed use of irrigation and drought resistant rice varieties (RD6 and KDML-150). In absence of long term historical data, confirmation of correlations between weather parameters and yield solely is challenging. Using Generalized Monsoon Index(GMI)and Hybrid Satellite Agriculture Drought Indices(HySADI)can improve the agricultureinsurance methodsthat are solely based on rainfall. It can also be used to validate appropriate areas to justify payouts in loss years and reduce basis risk for the crop insurance industry.The key contributions of the dissertation includes:1.Identifyingtheimplementationpractices and challenges in usingcrop insurance as a risk mitigation tool with detailed analysis oftworice producing developingeconomies: India and Thailand.2.Itis the first comprehensive study on agriculture insurance inThailandas well asthe first attempt to assess the feasibility of drought indices at province, district and farm level of Thailand.3.The study uses Multi-temporal agro-meteorological drought index like Generalized Monsoon Index (GMI) and remote sensing based drought indices like Normalized Difference Vegetation Index (NDVI), Land Surface Temperature (LST) and Temperature Vegetation Index (TVX) to evaluate drought impact on rice yield in Khon Kaen province of Thailand for 2011, 2012 and 2013.The existing insurance productsin Thailandare based on rainfall only. iv4.Province level GMI maps indicated 2012 as a severe drought year. However, the first crop rice yield (1987-2014) did not show good correlation with in-season rainfall. Analysis at district level also did not show good correlation between yield and GMI for 2011, 2012 and 2013.5.Strong positive correlation between NDVIsum and LSTsumwith R2 = 0.968 in Khon Kaen farm land was observed whichsuggests that water is not the only factor limiting vegetation growth and thus considering only rainfall as a proxy for yield would not be adequate indicator for the level of drought in the region.Area specific relationship between NDVI and LST would be useful for a better understanding of factors limiting vegetation growth. In absence of long term historical data, confirmation of correlations between weather parameters and yield solely is challenging. Interview and discussion with riceandinsurance experts and focused group discussion (FGD) with farmers during the field visit indicated that non-weather parameters such as irrigation and rice varieties play an important role.A model taking into account quantitative indicators and qualitative factors can be deployed to significantly improve the efficiency of crop insurance and reduce the basis risk.6.Developing seasonal GMI drought maps at province level would be useful in assessing and reducing basisrisk. GMI can also be used to develop thresholds that would consider the amount of rainfall based on the growth stages of the crop. 7.GISmaps generated indicate good yield for districts like Nam Phong and Mueang Khon Kaen despite drought conditions usingGeneralized Monsoon Index (GMI) in 2012.Districts found to have irrigation facilities, could come up with updated threshold water levels to be eligible for weather index insurance (WII) schemes based on further study. Also, drought resistant rice varieties and its impact on threshold weather level for insurance payments would be useful for insurance companies to reduce adverse selection and is an important area for further study.8.The use of Generalized Monsoon Index and Satellite based indices with modifications to take into account non weather parameters (e.g. type of rice, availability of irrigation) can improve the weather insurance models that are solely based on rainfall. It can also be used to validate appropriate areas to justify payouts in loss years and reduce basis risk for the crop insurance industry and also enhance the efficiency of drought subsidy programs. 9.Discussion with farmers, insurance company and BAAC in Thailand suggested low awareness among farmers about the potential benefits of weather index insurance products. Relatively low compensation is also an obstacle. Proper marketing and awareness raising campaigns should accompany any future introduction of index-based insurance.10.The thorough review of crop insurancepractice, policy and technology at country leveland drought related data analysis at province, district and farm levelcarried out in this study wouldfacilitatedevelopment of index that would assist in reducing the basis risk. Possible solutions suggested would further improve the confidence of insurance providersand farmersin use of agro-meteorological data for successful adoption of crop insurance. vThe output of this research will be very valuablefor insurance sector, government and future researchers in reducing individual risks of farmers |
| Year | 2017 |
| Corresponding Series Added Entry | Asian Institute of Technology. Dissertation ; no. RS-17-01 |
| Type | Dissertation |
| School | School of Engineering and Technology (SET) |
| Department | Department of Information and Communications Technologies (DICT) |
| Academic Program/FoS | Remote Sensing (RS) |
| Chairperson(s) | Tripathi, Nitin Kumar |
| Examination Committee(s) | Sarawut Ninsawat ;Soni, Peeyush ; |
| Scholarship Donor(s) | Asian Institute of Technology Fellowship |
| Degree | Thesis (Ph. D.) - Asian Institute of Technology, 2017 |