Model of Rice Farm Insurance to Reduce Losses Due to Harvest Failure
Agung Prabowo1, Mustafa Mamat2, Sukono3

1Agung Prabowo, Department of Mathematics, Faculty of Mathematics and Natural Sciences, Universitas Jenderal Soedirman, Purwokerto, Indonesia.
2Mustafa Mamat, Department of Informatics and Computing, Universiti Sultan Zainal Abidin, Kuala Terengganu, Malaysia.
3Sukono, Department of Mathematics, Faculty of Mathematics and Natural Sciences, Universitas Padjadjaran, Indonesia.
Manuscript received on 03 August 2019 | Revised Manuscript received on 26 August 2019 | Manuscript Published on 05 September 2019 | PP: 231-236 | Volume-8 Issue-2S7 July 2019 | Retrieval Number: B10590782S719/2019©BEIESP | DOI: 10.35940/ijrte.B1059.0782S719
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Abstract: The rice farm insurance is one of micro insurance, which is intended for paddy fields. Its use is to reduce or minimize the losses suffered by farmers due to crop failure. In this article various things are related to rice farming insurance and specifically highlight rice farming insurance in Indonesia from the actuarial side. There are several actuarial methods that can be used to determine the amount of rice farming insurance premiums. Calculation of premiums is based on expectations of losses and losses of extreme events. The premium calculation used is: pure premium method, and method of level of coverage. Based on the results of the discussion, it shows that the actuarial fair premium determined in the range of IDR 179,000 to IDR 268,000. Thus, the official premium of rice farming insurance is IDR 180,000, is the minimum premium for agricultural insurance programs in Indonesia.
Keywords: Rice Farming Insurance, Premiums, Actuarial Methods, Pure Premium, Level of Coverage.
Scope of the Article: Probabilistic Models and Methods