DEMAND FOR AGRICULTURAL INSURANCE IN FARS PROVINCE, IRAN

Today, natural hazards are important issue in front of policy makers as well as farmers across the globe because; Extreme events and climate disasters can have devastating impacts on agriculture. Farmers, especially, those depending on rain-fed agriculture, are extremely vulnerable to these risks. Nowadays, there is a significant surge in natural hazards due to changes in climate. Farmers usually have few options for risk management and their coping strategies are often inefficient and fail to fully mitigate these threats when they suffered catastrophe. Agricultural insurance is an efficient risk transfer tool. Unlike developed countries, where agricultural products were often insured, the coverage of agricultural insurance was still very low in Iran before 2000. To overcome problems and gaps in traditional crop insurance programs in developed countries, alternative solutions are therefore urgently needed. Insurance products exhibit some potential in this regard (Skees et al. 1999). To test if agricultural insurance (AI) could offer an appropriate approach for sharing and mitigating weather risk in rural Iran. Before designing an AI product and preparing its sales to farmers, it is crucial to understand what these farmers and their householders’ desire so that the AI product can be tailored to fit their needs. This paper focuses on the demand analysis for AI with this goal, 220 households located in FARS province were surveyed.

Keywords:

agricultural insurance , demand analysis , risk , coping mechanisms , Fars province