Timing And Mode Of Agricultural Catastrophe Insurance Market In Yunnan Province Government Intervention

Yunnan province has suffered four years of drought since2009. Agriculturalproduction had been seriously affected and the agricultural economy experienced ahuge loss. Specially, the drought in2010was the once-in-a-century. At the height ofthe drought, there are nearly6million people,3.6million head of large livestock havetrouble in drinking water; More than3.25million people cannot to maintain life without government aid; Cold season crop planting also suffered a devastating blow. Theloss areas are as high as85%. According to incomplete statistics, the directagricultural economic loss is over10billion yuan. As one of national agriculturalcatastrophe insurance system construction of pilot, Yunnan province have made somenatural disasters such as drought as a policy agricultural insurance of the basicmanagement in August2012. After years of hard work, the market has preliminarilyestablished and it consists of many insurance companies. The scale of insurance hasbeen increased a lot and the security level has a fundamental breakthrough. However,the insurance compensation is too little to protect the agricultural from the drought.Compared with the international advanced level, such as the high insurancecompensation ratio which is more than75%in American, we still have a long way togo. The low effect of agricultural catastrophe insurance can be seen in many aspects:the demand exceeds supply; the compensation is not enough; etc. The reason is thatthe government excessive intervention in the market disrupted the market order anddestroyed the market equilibrium. In a certain scale of losses which the market coulddigest the risk itself, government should only take auxiliary measures such as pricesubsidy; When market on their own do not manage the disaster, the governmentshould start the administrative intervention to keep the disaster areas stable andrestore or rebuild the production situation as soon as possible. This thesis analyzes theagricultural catastrophe insurance market of Yunnan province through a field survey,and tries to prove how negative subsidies instead of price mechanism to reflect themarket supply and demand is on the market efficiency on the basis of the theory of economics. Further, in the perspective of market capacity, the thesis measured inYunnan province agricultural catastrophe insurance market capacity and analysiswhen the government should intervene in the market in administrative way. Drawinglessons from the domestic areas and international areas which agricultural catastropheinsurance system has successful experience, the thesis puts forward policysuggestions accordingly to ensure the long-term development of the agriculturalcatastrophe insurance system.The introduction part is a description of the realistic background. Agriculturalcatastrophe insurance system development is facing a bottleneck, so it is necessity andurgency to improve the system. Literature review section introduces the presentresearch situation of selected topic.The second chapter analyzes the agricultural catastrophe insurance market ofYunnan province on the basis of field investigation. Underwriting, claims, marketservice system construction involved, etc. Introduces the development status andmode of government intervention and expounds the problems existing in currentmarket with plenty of facts and data.The third chapter focuses on theoretical and empirical study, to analyze the bestcoordination the government and the market and how to increase social welfare utility.Based on the measurement of agricultural catastrophe insurance market capacity ofYunnan province, studied the timing of government intervention in the market.The fourth chapter is for the reference to the experience at home and abroad.This part tries to find a enlightenment to perfect the system of practice through theanalysis of Anhui, Jiangsu and Beijing, as well as the experience of the United States,Japan and Spain.Chapter v puts forward a specific suggestion of government intervention marketconstruction.The last chapter summarizes the full text, points out the existing shortcomingsand the direction in the future.This thesis’s innovation point is that giving the model of commins a newapplication. The possible contribution is trying to break the agricultural insurance in academic circles on strengthening the government leading role general view of thepattern, and focus on building a complete market mechanism according to the theoryof western economics and empirical research.