Study On Regionalization Development Of Forest Insurance Based On Risk Zoning In China

To realize sustainable operation of forest insurance, a complete database of various forest casualty losses should be established based on the evaluation of actual forest disaster risk. The risk area and premium rate should be divided according to scientific theories and methods. The basic types of insurance offered premium subsidies by finance were run in the different risk areas based on various risk level. This operation not only was more fairly to policyholders, but also reduced the finance burden of government. Thus, it should be the prerequisite and direction of reform and development on forest insurance to set an appropriate insurance rate and subsidy rate.Current domestic studies on forest insurance were in the primary stage, limited to descriptive analysis, policy recommendations. There was less for relevant quantitative research, especially less for actuarial studies. This article focused on the detailed empirical research and statistical analysis of risk assessment, risk zoning, rate making of forest disaster, and demand for financial subsidies, supported by regional development differences of forest insurance in China.Firstly, on the basis of description of forest insurance, insurance division and regional development theory, the constraint factors for development forest insurance were analyzed in the article such as insufficient effective supply and effective demand, adverse selection and moral hazard, government assistance and forest insurance, voluntary insurance and compulsory insurance, combined with the present situation of forest insurance in China. These development measures of forest insurance should be taken to solve above problems such as financial subsidies, risk zoning, appropriate intervention. Through detailed regional differences description on forest insurance development, it pointed out that the products, rate, size of regional insurance supply is decided by the specific demands for insurance types, structure and quantity. The corresponding degree of government financial support was also determined by above factors.Secondly, the risk zoning index of various forest disasters was selected and quantified in the fourth part of paper. Fire loss and fire danger index were the risk zoning index of forest fire. The pest, disease and rat disaster were described by occurrence acreage, damaged acreage, damaged rate as damage indicator and control rate as the inverse index of disaster loss. The forest vulnerability, scale, efficiency and disaster response capacity exponent were general index. By method of factor and cluster analysis,31 provinces and cities in China were respectively divided to high risk area, higher risk area, medium risk area, lower risk and low risk area.Thirdly, In view of time series loss ratio on forest disasters, the exponential smoothing was used to predict the future loss rate. Stability coefficient and risk coefficient were added to get the pure forest insurance rate. The subsidies demand for forest insurance of each province was further estimated according to the factors of pure rates, financial payment capacity, purchasing power of forest householders, and development level of regional insurance. The forest insurance development in Hunan was taken as the case to verify the relationship of premium income, forest fanners income, regional economic development level, participating insurance rate, previous year claim ratio. And according to the result of risk division and premium rate, the study put forward the optimization strategy to further develop the forest insurance in Hunan Province.Finally, after zoning the regional degree of risk, formulating the premium rate and analyzing the regional subsidies demand of forest insurance, a unified security system of forest insurance development in China was built from four aspects, such as the legislative regulation of forest insurance, reinsurance system, forest catastrophic risk fund, regulatory system for actinsurance.