Area approach (area-yield basis)

An agriculturally homogeneous area that can be insured as one unit.

Unit composition

This unit may comprise several blocks of land farmed by the same farmer or different farms farmed by different farmers.

Loss adjustment

For loss adjustment in this approach, the actual average yield is assessed by sample survey through crop cutting or other methods, and compared with the normal (insured) yield.

Average yield loss

The average yield loss is applied to all land of all farmers within the defined area, disregarding individual differences in actual damage and crop yield.