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Abstract
The paper looks at a hypothetical area
yield insurance at the level of Farm Accountancy Data
Network (FADN) regions: Regional Yield Insurance
(RYI). Total premium cost is evaluated for each MS and
EU-27 assuming that the whole crop surface for each
single arable crop is insured. In order to check the
efficiency of RYI for smoothing the farmers’ income, we
calculate the farmers’ yield variability from a sample of
individual farm FADN income data for two scenarios.
The first scenario is the current one without RYI, and
the second one is with RYI under the hypothesis of
100% market penetration. These analyses enable us to
evaluate the potential of RYI as a farmers’ income
stabilizer. Moreover, they provide an insight of the
potential of other kinds of index products in the
heterogeneous European landscape. Results show that
the risk reduction capacity of RYI is not very high for
the case analyzed (wheat). However, there are some
exceptions where the risk can be significantly reduced.