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Mutual insurance companies as a tool for farmer income stabilization: performance and prospects in the CAP

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  • Assefa, Tsion Taye
  • Meuwissen, Miranda P.M.
  • Van Asseldonk, Marcel A.P.M.

Abstract

The European Commission is currently considering the introduction of income stabilisation tools as a means of stabilising farmers’ incomes throughout the European Union. One of the options is to use mutual insurance schemes. The objectives of this paper are to analyse the performance of mutual insurance companies currently operating in The Netherlands and to discuss the pros and cons of mutual insurance schemes as tools for farmer income stabilization. Data was collected through interviews with the companies’ experts and from the companies’ websites. We conclude that, even though provision of net income and revenue insurance goes beyond their expertise, mutual insurance companies are effective in insuring farmers against income fluctuations arising from specific agricultural production risks. In order to encourage solidarity among farmers, policy support that stimulates the development of local mutual insurance companies can be more beneficial than support aimed at companies operating in more than one European country.

Suggested Citation

  • Assefa, Tsion Taye & Meuwissen, Miranda P.M. & Van Asseldonk, Marcel A.P.M., "undated". "Mutual insurance companies as a tool for farmer income stabilization: performance and prospects in the CAP," 126th Seminar, June 27-29, 2012, Capri, Italy 125991, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa126:125991
    DOI: 10.22004/ag.econ.125991
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    References listed on IDEAS

    as
    1. Cabreales, Antonio & Calvo-Armengol, Antoni & Jackson, Matthew O., 2003. "La Crema: A Case Study of Mutual Fire Insurance," Journal of Political Economy, University of Chicago Press, vol. 111(2), pages 425-458, April.
    2. Meuwissen, Miranda P. M. & Van Asseldonk, Marcel A. P. M. & Huirne, Ruud B. M., 2003. "Alternative risk financing instruments for swine epidemics," Agricultural Systems, Elsevier, vol. 75(2-3), pages 305-322.
    3. Carlo Cafiero & Fabian Capitanio & Antonio Cioffi & Adele Coppola, 2007. "Risk and Crisis Management in the Reformed European Agricultural Policy," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 55(4), pages 419-441, December.
    4. Bielza, Maria & Stroblmair, Josef & Gallego, Javier & Conte, Costanza G. & Dittmann, Christoph, 2007. "Agricultural risk management in Europe," 101st Seminar, July 5-6, 2007, Berlin Germany 9252, European Association of Agricultural Economists.
    5. Meuwissen, Miranda P.M. & Van Asseldonk, Marcel A.P.M. & Pietola, Kyosti & Hardaker, J. Brian & Huirne, Ruud B.M., 2011. "Income insurance as a risk management tool after 2013 CAP reforms?," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114649, European Association of Agricultural Economists.
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