Mixed Copula Function In Crop Income Insurance Research On Application Of Rate Setting

At present,the agricultural insurance policy in our country is mainly based on cost insurance,which only covers the loss of crop production reduction caused by natural disasters.It can not guarantee the loss of farmers'income caused by fluctuation of agricultural product prices.With the further development of market economy,the shortcomings of guaranteeing quantity and insuring price become more and more obvious,and the income stability of farmers can not be guaranteed in a real sense.Income insurance,which takes income as the subject matter of insurance,can cover both output and price risks,and has a wider range of risk coverage.At present,it has become the trend of developing agricultural insurance all over the world.Therefore,Chinese scholars began to study income insurance to meet people's increasing risk management needs,and the key point of income insurance research is how to formulate a scientific and reasonable income insurance premium rate.Based on mixed Copula function and nonparametric kernel density estimation,this paper studies the pricing of crop income insurance.The main work is as follows:(1)On the basis of denoising the data of crop yield and price by Wavelet analysis,the unit yield and price risk of wheat in Shandong Province were estimated by non-parametric nuclear density estimation.(2)The mixed Copula function was applied to the determination of crop income insurance premium rate,and its weight and dependent parameters were estimated by EM algorithm to obtain the joint distribution of yield per unit area and price of wheat,and compared with the single Copula function in terms of fitting effect.The results showed that the mixed Copula function was more reasonable in describing the relevant structure and more accurate in determining the rate for wheat yield per unit area and price data in shandong province.(3)On the basis of the joint distribution of yield and price data,the corresponding wheat yield and price data were obtained by Monte Carlo simulation,and the income insurance rates under different guarantee levels in Shandong Province and its cities were calculated.The results show that under the 85%-100%guarantee level,the wheat income insurance rate in Shandong Province is between 1.09%and 5.45%,which is higher than the production insurance rate under the same guarantee level.The difference in income insurance rates between different cities is obvious.(4)With reference to the development history of international agricultural insurance and its business model,several policy recommendations have been put forward for China to further improve the agricultural insurance system.