Experience of the TeamTeam members have specific RMA-funded research project experience on the following projects:
Reviewing FCIC crop policy provisions, crop insurance administrative handbooks (underwriting and loss adjustment procedures) and actuarial documents to determine if they adequately and equitably address prevented planting situations at the localized and individual insured level. Identifying specific localized PP situations that may have occurred, including regions in the southeastern U.S. and at least two other areas of the country as applicable, determining if PP policy provisions and loss adjustment procedures were applied correctly, fairly and consistently in addressing such PP localized or isolated cases. Analyzing PP payment history using data available from RMA to identify the frequency of PP claims in localized areas. In addition, analyzing 25 percent of PP claims made to policyholders in a representative area to determine if the application of PP provisions is consistent among insurance providers. Recommending changes to crop policy PP provisions and administrative procedures to ensure consistent, fair, and equitable treatment of insureds in a localized or individual PP situation. Clearly stating the benefit derived from such change, and the cost affiliated with implementing and administering the change and an estimate of any associated premium rate change.
Multiple Year Coverage Risk Management Program Describing fraud, waste, and abuse in the crop insurance program by insured producers located in the geographical areas and whether a multi-year policy would reduce fraud, waste, and abuse by insured producers in the same geographical areas.
Feasibility of Revenue Coverage Plans that Maximize Producer Revenue Investigating opportunities for new and improved revenue coverage plans designed to enable producers to take maximum advantage of fluctuations in market prices and thereby maximize revenue realized from the sale of an agricultural commodity. Researching the feasibility of: Developing several new revenue coverage plans for RMA insured and uninsured crops. Developing modifications to or improvements of RMA’s current revenue insurance products. Developing new market instruments or marketing contracts that support current or proposed revenue insurance products for insured crops, insured crops with no revenue coverage, and uninsured crops. Expanding existing revenue coverage plans to additional commodities, including dry beans in California. Recommending priorities for further development and implementation of new, modified, or expanded revenue coverage plans; and new market instruments, marketing contracts, or combinations that are recommended as feasible.
Cotton Boll Weevil Eradication Program Impact on Actual Production History Yields Delivered a study identifying the reasons for and quantifying the amount of change in cotton yields within the Southern cotton-growing regions of the United States that have undertaken systematic, area-wide efforts to detect, eradicate, suppress, control, or at least to prevent or retard the spread of boll weevils and to recommend one or more methodologies for adjusting the cotton producers’ APH.
Applying Data Warehousing, Data Mining, and Data Analysis Techniques Toward Crop Insurance Loss Patterns Analysis Project Identified trends, patterns, anomalies, and relationships between reinsurance organizations, insurance agents, adjusters, and producers in crop insurance data provided by the USDA indicative of excess claim adjustment over actual crop loss. Incorporated data analysis and data mining techniques to accomplish this objective. Identified proposed county yields, actual yields, and actual losses over a four-year cycle. Identified which insurance agents, loss adjusters, and producers claim losses that appear inconsistent with other insurance agents, loss adjusters, and producers within the same county and/or adjacent counties. Identified losses by insurance agent, loss adjuster, and producer according to practice code (irrigated vs. non-irrigated) assess deviation from norm and multiple standard deviations. Identified patterns of collusion and anomalous behavior. Identified patterns of losses by insurance agent, loss adjuster, and producer according to reinsurance agreement (assigned risk fund), rate of policy, loss units, and cause of losses. Provided RMA with a method to process a large volume of yield data to identify situations in which production may have been erroneously reported in such a manner to enhance indemnity payments. Primarily focused on situations in which part of all of the production actually produced on a particular piece of land is reported as produced on other land. Refined earlier work on yield switching within a farm (reported under the same farm ID). Analyzing the reconstitution of units (reallocation of land to units) within a farm. Recommending methods to be developed to identify unacceptable land reallocation practices.
Developing Catastrophic Rating Methodology and Incorporating CAT Coverage Data Reviewed catastrophic rating methodologies and proposed alternatives. Reviewed current conversion methodology and procedures for RA and CRC data to determine that this has been done as accurately and efficiently as possible. Recommended a catastrophic rating methodology. Expansion of Income Protection Insurance Dr. Atwood and Dr. Watts developed a new premium rating method that addresses some of the deficiencies in the usual MPCI rating. The MPCI rating method does not adjust for changes in technology (yields have almost doubled since crop insurance began in the U.S. in the 1930’s), uses data from a relatively small number of recent years, and uses the same expected yield and coverage, spreading factors across crops and production regions. The IP approach explicitly accounts for technology, combines long-term available regional data with shorter-term farm data to reflect infrequent events, and rates across coverage levels and expected yields, which are reflective of the available data in that region. The IP approach can be used for either yield or revenue insurance. The revenue insurance appropriately incorporates price-yield correlation. Currently the IP approach rated by members of the Watts Team is being piloted in 19 states and six crops. Indexing - A crucial step in determining indemnity payments and premiums is determining the producer’s “normal” or expected yield. In the U.S. the producer’s expected yield is based upon the average of from four to 10 years of his/her production history. The accuracy (statistical efficiency) of basing the expected yield on only four to 10 observations is of concern. Producers were concerned about the changes in expected yield as their yield history was updated. A statistical method was developed that incorporates information from other data sources to stabilize the expected yields through time and increase the statistical efficiency of expected yields. Range/Pasture Crop Insurances Evaluated the feasibility of a crop insurance program for range and pasture producing forage. During the past year Dr. Atwood and Dr. Watts conducted a preliminary investigation into the feasibility of a crop insurance program for grazing forage. Dr. Atwood and Dr. Watts developed the necessary modifications to the IP rating methods. Producer-level data has been difficult to obtain and is limited. In those areas where producer-level data exists, the relationship between regional- and producer-level data is analyzed and extrapolated to areas where producer-level data does not exist. Thereby, premiums can be developed for many more regions. Reviewed MPIC cotton program in 11 western states For the RMA, reviewed the cotton crop insurance program in the 11 major cotton states. This review included an evaluation of the rating method, data used, coverage available, and various contractual terms. In several states, the premium rates have been adjusted. Expanded avocado program to five additional counties RMA asked Dr. Atwood and Dr. Watts to develop a crop insurance program for avocado. Dr. Atwood and Dr. Watts customized the IP rating process to fit the biological process and market peculiarities of avocado. Dr. Atwood and Dr. Watts supervised data gathering at the farm level and obtained the needed NASS data used to statistically calculate premiums. Dr. Atwood and Dr. Watts then developed rate quoting software. Dr. Atwood and Dr. Watts continue to maintain the software, update the premiums, and address problems as they arise. About 50 percent of the eligible avocado producers enrolled in the program in the first year.
Research Report Livestock Insurance Program Watts and Associates is under contract to RMA to analyze the livestock industry and evaluate the viability of potential livestock pilot insurance programs. Watts and Associates will develop criteria for pilot insurance programs, assess risk perspectives and strategies, and detail the risk management needs and interests of producers. Watts and Associates will also study the likely industry impact of an insurance program and determine the feasibility of offering a pilot livestock insurance program.
Evaluation of the Group Risk Plan – Rangeland Pilot Insurance Program (GRP Rangeland) - Completed Watts and Associates has completed an RMA contract to evaluate the Group Risk Plan – Rangeland Pilot Insurance Program and determine if it should be converted to a permanent program, continue as a pilot program, be modified, or be discontinued. Watts and Associates collected, validated, and analyzed both RMA and other relevant data. Further, input from producers and other interested parties was gathered during listening sessions that were held in three Montana locations. Finally, Watts and Associates reviewed existing rates to determine actuarial soundness.
Research and Development of a Pilot Crop Insurance Program for Silage Sorghum RMA has contracted Watts and Associates to develop the components of a silage sorghum crop insurance pilot program. Watts and Associates will design and develop all program components as follows:
Quality Review of Dry Bean and Sugar Beet Crop Insurance Policies Watts and Associates has been contracted by RMA to assess the dry bean and sugar beet crop insurance policies. Watts and Associates will identify any problem areas or issues with the crop policies and will make recommendations for crop policy and program changes to limit fraud, waste, and abuse. Watts and Associates will use our expertise in crop insurance policy development to assure actuarial soundness, and determine acceptability of the crop programs to producers, insurance providers, the Government, and other interested parties.
Research Report Storage Insurance Options for Apples, Onions, Sugar Beets, and Sweetpotatoes Watts and Associates is working under contract with RMA to determines the feasibility of offering insurance for storage of apples, onions, sweetpotatoes, or sugar beets. Watts and Associates will conduct research to identify the risks confronted by storage crop producers and describe their techniques for managing risk. Watts and Associates will also 1) investigate the impacts of developing or expanding crop insurance programs, 2) propose options for each crop for new product development and/or modification of existing programs, and 4) recommend to RMA the best proposal for product development.
Research and Development of a Christmas Tree Insurance Program Watts and Associates is under contract from RMA to deliver the components of a crop insurance pilot program for Christmas trees. Watts and Associates will conduct a study to establish objectives for research and criteria for a viable insurance program. In preparing the pilot insurance program, Watts and Associates will gather input from producers, collect and analyze data, and determine the impacts and economic risks of Christmas tree production and marketing. Watts and Associates will also evaluate the feasibility of offering a pilot Christmas tree insurance program to producers. If feasible Watts and Associates will design and develop all program components required for program implementation.
Research Report for Hybrid Sunflower Seed, Sesame, and Spelt Crop Insurance Programs RMA has contracted Watts and Associates to conduct a research study to analyze the feasibility of developing a crop insurance program for hybrid sunflower seed, sesame, and spelt. If feasible, Watts and Associates will recommend and justify a new or existing crop insurance structure for insuring each crop.
Review of AUP and ELS Cotton Skip-Row Planting Factors Watts and Associates has been contracted by TKCC (for RMA) to conduct a research study of the AUP and ELS cotton skip-row planting factors. In particular, Watts and Associates will conduct research and make recommendations regarding current skip-row standards, non-irrigated, cotton skip-row yield conversion factors, and associated planting procedures. Watts and Associates will use our expertise in data collection, validation, analysis, statistical modeling, and crop insurance procedures to determine the validity of existing factors.
Sweetpotato Pilot Evaluation Watts and Associates has been contracted by RMA to evaluate the sweetpotato pilot crop insurance program. Watts and Associates will assess the rating and pricing sufficiency of the program and feedback from program stakeholders to determine if the sweetpotato crop insurance program should be continued as a pilot, modified, terminated, or converted to a permanent program.
Cultivated Wild Rice Pilot Evaluation Watts and Associates is working under contract with RMA to review the cultivated wild rice pilot crop insurance program. Watts and Associates will gather feedback from program stakeholders, compile a Feedback and Issues Report on the program, and evaluate the rating and pricing sufficiency of the program. These factors will be used to determine if the program should be continued as a pilot, modified, terminated, or converted to a permanent program. |
Key Staff Profiles Dr. Myles Watts Dr. Joe Atwood Dr. James Driscoll Tim Watts Dr. Randy Landgren Steve Loar, MCPD, MCSE, MCAD, MCSD, MCDBA  |