Private agricultural insurance model for small agricultural producers in Mexico

Abstract

The Federal Government has encouraged the practice of agricultural insurance with subsidies to the producers who use these services, but the way in which expenses have been channeled to strengthen the practice of insurance has not been sufficient to achieve, especially among small producers, generalize this practice. The objective of this research was to propose a model of agricultural insurance, whoever acquires it receives additional benefits to those that normally exist and are obtained in traditional insurance, in the year 2018. The methodology starts from the theoretical principle of Burns’ economic cycles and Mitchell which is one of the first time series studies of business cycles based on Avella-Gomez and Ferguson. With the statistical regression technique applied to production and yield data of the basic crop, for this case white corn, modeled with the Statistical Analysis System (SAS) program. Some results and conclusions observed were that unlike traditional insurance, it is proposed that the amounts to be paid for insurance premiums be determined before each agricultural cycle, with field information obtained by specialists and government technicians who are more close to the producers. It is considered that different amounts of insurance premium should be determined by agricultural region of the Rural Development District, by crop and by irrigation or temporary water regime.