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Imperfect Insurance Discussion Questions

-Are there years in which there was a bad harvest, but no index insurance payout?

-If you purchased this index insurance contract as protection against a bad harvest, would it help you to plan your investment decisions for the upcoming planting season?

-Is it enough to just purchase insurance in order to protect yourself from risk?

-How can you protect yourself during the years when index insurance fails to protect you?

-What other risk management strategies could you use?

-Is it useful to have insurance that addresses a big part of the risk, even if it doesnt address all risk?

Key Points

Insurance is not perfect; there are some risks it will fail to cover. Insurance does not have to be perfect in order to be useful; it does need to be good enough for farmers to feel confident in investing. Other risk management strategies are usually necessary to address the gaps in insurance. These games can be automatically generated using the indexes and costs for actual local situations, eg output of DESDR crowdsourcing/codesign

  • Dr Blakeley led research showing : Real world adoption is HIGHER when farmers are trained on errors of the product