Gustav!!

As an actuary who has works with catastrophe models off and on, I'm always interested in what's happening during hurricane season. This Insurance Journal Article outlines the forecasts for Gustav by RMS and AIR, two of the catastrophe modelers out there.

I'm working on two other blogs right now - one on Pay-As-You-Drive insurance and one about getting filings approved in Florida, so stay tuned.

Meanwhile, time will tell if Gustav intensifies and threatens New Orleans again.

Food Shortage

This article by Jeffery Sachs in Scientific American Magazine caught my eye in light of yesterday's blog - check it out! The picture is from the article referenced.

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I take a couple of actuarial lessons from the article.

First, that over time models age. What was a workable model today, needs refreshing or even, overhauling, for use tomorrow. This isn't the fault of the modeling process (I was disturbed that Malthus being "ridiculed" in economics classrooms).

Second, that models can always be improved. We are warned not to over-parametrize models, and that's not what I'm saying. Improvement can come from discovering or including other factors not included in the original design or even removing something that is no longer predictive of the outcomes. Improvement can also mean a better, updated fit based on more current information. (Such as shifts in fertility and mortality in Malthus' model).

Lastly, models should never be taken as the gossip truth in any case. The lesson that economists (and resource management) should have taken from Malthus' work was not the precise year or the precise population that would "break the bank", so to speak. The lesson was that attention should be paid to our consumption and world population. Just like when you're growing that 401(k) balance, the earlier you start dealing with these issues, the easier the fix might be.

Global Climate Change and Crop Insurance

Being married to a biologist and having a fairly big interest in science, topics regarding climate change always get my attention. It is one thing to show the melting ice around the world or predict flooding in low-lying lands. It is quite another to tackle the issue about how global climate change will impact agriculture in all its forms.

From the Midwest, I think of corn and soybeans first, naturally, but what about forests, citrus, rangeland, nursery, farms that depend on fresh or sea water, etc.?

Released in May, 2008, the U.S. Climate Change Science Program (CCSP) authored "Synthesis and Assessment Product 4.3 (SAP 4.3): The Effects of Climate Change on Agriculture, Land Resources, Water Resources, and Biodiversity in the United States." The report was produced by 38 authors from a diverse group of institutions. Universities, national laboratories, non-governmental organizations, and federal service all cooperated on this report and yet another group from the USDA peer reviewed the report.

The report is a type of literature review of the research efforts taken so far. Some 13 agencies have done federal research on some of the questions on global climate change. Some of the conclusions of the report are summarized on the press release about the report.

The report is fascinating. It is very long and comprehensive and is as notable for what is not known as what is known. Nevertheless, an impressive volume of research has been done on the topic to date with more to come.

I know I'll be keeping my eyes and ears open for updates. Crop insurance is one of my interests - particularly corn and soybeans in the Midwest. Upcoming blogs will no doubt touch on my independent work in crop insurance.

Be sure to email me or leave a comment if you'd like copies of my work with crop insurance as segments are completed.