Via journal online., Agriculture is inherently a risky enterprise because of its dependence on rainfall. To mitigate
risks, farmers diversify crops and enterprises, maintain stabilization account or resort to the sale of assets. Crop insurance is a complementary institutional mechanism that aids farmers to cope with risks better.Considering the importance of crop insurance in risk mitigation, this paper using data from a large-scale farmers’ survey we identify the factors that influence farmers’ decision to buy crop insurance and subsequently assess its impact on farm income, production expenses and productive investments in agriculture. Farmers’ adoption of crop insurance is low— 4.80% kharif season and 3.17% in the rabi season mainly on account of lack of awareness about insurance products. Nevertheless, the probability of adoption of insurance is higher for those who experience higher crop loss and have some formal training in agriculture. The subsidy on premium also positively influences crop insurance uptake decisions. On the other hand, the factors like the lower social status, tenant farming and exposure to deficit-rainfall in the previous year are negatively associated with the decision to insure. The results on the impact of insurance are not conclusive to prove that insured farmer subsumes higher risks compared to the uninsured.
de Haan, Peter (author) and Keilbach, Tomas (author)
Format:
Book chapter
Publication Date:
1993
Published:
Burundi
Location:
Agricultural Communications Documentation Center, Funk Library, University of Illinois Document Number: C21102
Notes:
Pages 141-160 in Innovation and development: policies, concepts and cases for agriculture and forestry in international cooperation. Wissenschaftsverlag Vauk Kiel KG. 212 pages.
Agricultural Communications Documentation Center, Funk Library, University of Illinois Document Number: D08629
Notes:
Located in Review of Extension Studies, volumes for 1946-1956, U.S. Department of Agriculture, Washington, D.C., Summary of thesis research for the master of arts degree, University of Maryland, College Park. 78 pages., Comparison of farmers who attend and do not attend extension meetings.
