The farmer must insure all the seeded acres of eligible corn and must insure a minimum of five acres for each crop: grain and silage crops are considered separate for the purposes of referring to a specific insurance contract. Only producers growing grain or silage corn on irrigated land in AFSC designated areas are eligible to buy a CHU insurance contract. Contract end users can select a weather station for the settlement from


the federal and provincial stations available, choosing the station that best represents the temperatures on their farms. Coverage is available in $25 Canadian Dollar (CD) increments with a minimum of CD$100 per acre for both grain and silage corn and a limit of CD$225 and CD$300, respectively. The premium payable under the CHU contract is due upon receipt of the contract by the farmer. The formula to calculate the indemnity for each insurable crop is given by the following equation: Indemnity=Dollar Coverage per Acre×Payment Rate×Number of Insured


Acres Bibliography Agarwal, A. (2002), A new approach & model for weather derivative


instrument based on water table for floods, droughts and rainfalls; Finance India; Sep 2002; 16, 3; ABI/INFORM Global. Brocket, Wang, Yang (2005), Weather, derivatives and weather risk


management Risk Management and Insurance Review, Spring 2005; 8, 1; ABI/INFORM Global.


Buckley, N., Hamilton, A., Harding, J., la Roche N., Ross, N., Sands, E., Skelding, R., Watford, N., Whitlow, H.; European Weather Derivatives; General Insurance Convention 2002/ Nick Ross (Chairman). 08 Oct 02; http:// www.actuaries.org.uk/files/pdf/giro2002/Ross.pdf Campbell, S.D.; Diebold, F.X.; Weather Forecasting for Weather


Derivatives; Journal of the American Statistical Association; Mar 2005; 100, 469; ABI/INFORM Global; pg. 6 Edrich, C. (2003), Weather risk management; Journal of Financial


Regulation and Compliance; May 2003; 11, 2; ABI/INFORM Global. Harwood, J., Heifner R, Coble, K., Perry, J., and Somwaru, A. (1999),


Managing Risk in Farming: Concepts, Research, and Analysis; Market and Trade Economics Division and Resource Economics Division, Economic Research Service, U.S. Department of Agriculture; Agricultural Economic Report No. 774.; Washington, DC 20036-5831 March 1999. Linnerooth-Bayer, J.; Mace, M.J.; Verheyen,R. (2003), Insurance – Related actions and Risks Assessment in the Context of the UNFCCC, Background Paper for UNFCCC workshops Commissioned by the UBFCCC Secretariat: May 2003. Mahal, G. (2001), Issues in hedging a weather derivative; Derivatives Use, Trading & Regulation; 2001; 7, 1; ABI/INFORM Global.


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