Author(s)

Liu Shoucen ¹, Liu Chang ¹, Liu Zhenyu ¹

Affiliation(s)

¹ Department of Automation, North China Electric Power University, Baoding, China

Corresponding Author

Liu Shoucen

ABSTRACT

Extreme weather events are a growing concern for property owners and insurers. Property insurance is not only becoming more expensive, but also increasingly difficult to find as insurers change their underwriting policies and regions. It is important to note that this is a factual statement and not a subjective evaluation. Based on this, the purpose of this model is to study the sustainability of property insurance and other related issues. The aim of this study is to design a weather index insurance scheme for northeast and South China to obtain a reliable momence-based production function estimation. The Unit-Root test and the Feasible Generalized Least Squares method involving the panel data model were explored using provincial cash crop production and weather data from 1989 to 2017. The results of the study show that the main weather variables (temperature and rainfall) have a significant impact on crop production. We propose weather index insurance as an institutional safeguard against the risk of reduced crop yields due to climate change in 2030, 2060 and 2090. According to the weather index insurance design, the insurance schemes for rice, oil palm and rubber tree have risk reduction performance of 8.14%, 13.37%, 2.43%, 6.48%, 8.89% and 14.13%, respectively. Weather index insurance is a guide that farmers can use to mitigate the adverse effects of future climate change on cash crop production. The study proposes an insurance scheme to protect crop production losses from climate change scenarios.

KEYWORDS

Unit-Root test; Feasible Generalized Least Squares; Property & Casualty Insurance, Sustainability; Optimization Algorithms

CITE THIS PAPER

Liu Shoucen, Liu Chang, Liu Zhenyu, Impact of Climate Change on Property Insurance in Northeast China and South China. Information Systems and Economics (2024) Vol. 5: 63-68. DOI: http://dx.doi.org/10.23977/infse.2024.050309.

REFERENCES

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[2] Owen S, Noy I, Pástor-Paz J, et al. Measuring the impact of insurance on recovery after extreme weather events using nightlights[J]. Asia-Pacific Journal of Risk and Insurance, 2021, 15(2): 169-199.
[3] Li Z, Li Y, Long D. Research on the improvement of technical efficiency of China's property insurance industry: a fuzzy-set qualitative comparative analysis[J]. International Journal of Emerging Markets, 2021, 16(6): 1077-1104.
[4] Cai Haijie. Translation report of "Smart Response to Climate Change - Communication, Coordination and Cooperation" (excerpt) [D]. South China Agricultural University, 2020. 000312
[5] Li Ya. Research on Optimization of Insurance Products for Bull and Sheep Drought Index in Grassland Pastoral Areas [D]. Southwest University of Finance and Economics, 2019.001355
[6] Ma Chao. Analysis and Strategy Research on Disaster Reduction in Coastal Cities Guided by Elastic Targets [D]. Tianjin University, 2018. 002886.

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