AN ANALYSIS OF WILLINGNESS-TO-PAY FOR CROP INSURANCE*

Afghanistan is frequently affected by drought and other climate change related hazards due to increased temperature and reduced precipitation over most parts of the country. The present study was undertaken to analyze the climate change preparedness measures for adaptation and willingness to pay for crop insurance to mitigate the climate change impacts. This study was conducted in central agro-climatic zone of Afghanistan to collect the primary data through the random sampling technique with a total sample of 105 respondents from the seven provinces located in this zone. Likert type responses were used to assess the climate change adaptation and binary log it regression model was used to identify the factors affecting the willingness to pay for crop insurance to mitigate the climate change impacts on agriculture. The results of the study indicated that changing cropping pattern (74%) followed by receiving technical information from experts (70%) and keeping the land as fallow (60%) were rated as very high to high preparedness measures to mitigate the climate change impacts. Logit regression model revealed that the education and technical information received from experts were positively significant and their marginal effects implied that the probabilities of willing to pay for crop insurance were increased by 1.3 and 15.9 percent, respectively. The establishment of crop insurance agencies at province level may help reducing the impact of climate change and increasing the income and livelihood of the farmers.

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Exploring farmers’ willingness to pay for crop insurance products: A case of weather-based crop insurance in Punjab, India

Agricultural Economics Research Review ◽

10.5958/0974-0279.2020.00027.0 ◽

2020 ◽

Vol 33 (2) ◽

pp. 135-146

Author(s):

K S Aditya ◽

Avinash Kishore ◽

Md Tajuddin Khan

Keyword(s):

Willingness To Pay ◽

Crop Insurance

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Crop Insurance Scheme Among Paddy Farmers in Kedah, Malaysia: Are They Willing to Pay?

The Journal of Social Sciences Research ◽

10.32861/jssr.spi6.1167.1173 ◽

2018 ◽

pp. 1167-1173

Author(s):

Siti Aznor Ahmad ◽

Shamsul Bahrain Rawi ◽

Bakti Hassan Basri ◽

AmizamArzemi AmizamArzemi

Keyword(s):

Willingness To Pay ◽

Choice Experiment ◽

Crop Insurance ◽

Interaction Model ◽

Multinomial Logit Model ◽

Crop Failure ◽

Insurance Scheme ◽

Basic Model ◽

Marginal Willingness To Pay ◽

Paddy Farmers

This study examines the farmers’ willingness to pay (WTP) in contributing to the Crop Insurance Scheme (CIS) specifically among the paddy farmers in Kedah. The CIS reduces the risk that farmers face in the event of natural disaster such as flooding or crop failure causes from pest attack and crop diseases. In this study, we focus on three selected districts in Kedah. A total of 139 respondents were randomly selected from these areas. The CIS is based on a hypothetical product which contain of three main attributes; (1) type of coverage, (2) sum assured/benefit, (3) and premium payment or the price. Data are obtained by applying Choice Experiment (CE) technique and analyzed with the multinomial logit model (MNL). Two models are presented in this paper namely the basic model and the interaction model. The study shows, among others, that marginal willingness to pay to obtain protection from crop failure amongst the attributes ranges between RM33.69 to RM128.63 per year for the basic model. On the other hand the marginal willingness to pay for the interaction model ranges between RM19.42 to RM73.32.

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Willingness to pay for agricultural crop insurance in the northern EU

Agricultural Finance Review ◽

10.1108/afr-06-2014-0018 ◽

2014 ◽

Vol 74 (4) ◽

pp. 539-554 ◽

Cited By ~ 11

Author(s):

Petri Liesivaara ◽

Sami Myyrä

Keyword(s):

Willingness To Pay ◽

Crop Insurance ◽

Arable Land ◽

Mixed Logit ◽

Insurance Companies ◽

Agricultural Crop ◽

Content Type ◽

Factors Affecting ◽

Anchoring Effect ◽

Split Sample

Purpose – The purpose of this paper is to investigate the demand for crop insurance. Moreover, farmer willingness to pay (WTP) for crop insurance was derived. Factors affecting the demand were also examined in a country where crop insurance products are not currently available. Sensitivity analysis was conducted by studying the price-anchoring effect. Design/methodology/approach – Data from a choice experiment (CE) were analyzed with mixed logit models and the distribution of farmer WTP for crop insurance was derived. A split sample approach with varying premium vectors was used to analyze the price-anchoring effect. Findings – Demand was revealed for crop insurance products in Finland. The demand was higher among younger farmers and farms with more arable land. WTP for crop insurance products was very sensitive to the premium interval presented in the CE design. Research limitations/implications – The price-anchoring effect may disrupt the market development of crop insurance products, because insurance companies may take advantage of the lack of awareness among farmers of crop insurance pricing. Practical implications – The insurance product expected indemnity was a more important factor than the deductible in determining farmer WTP for crop insurance. Therefore, the 30 percent deductible level set for subsidized crop insurance products is not an obstacle for the development of such products in the EU. Originality/value – The study applied a well-known method (CE) to crop insurance in a country where these products are non-existent. The split sample approach was used to examine the price-anchoring effect on crop insurance.

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