Factors Influencing Crop Insurance Demand inKB Province, Iran:Logit Model Approach

ABSTRACT: Given the role of insurance in reducing income risk and fluctuations in sustainable agricultural development, in the present paper,factors affecting the demand for the insurance of crop (wheat and rice) products have been studied.In addition, the performance of Agricultural Insurance Fund(AIF) has also been evaluated.In Kohgiluyeh-va-Boyerahmad (KB) province, from two insured and uninsured farmer groups, a sample of 120 individualswas selected and required data were collected using cluster random sampling method through interview and filling questionnaires.The collected data were analyzed using Logit model and factors affecting insurance adaptionwere determined.The obtained results indicated that variables of age, education, agricultural experience, therate of insurance awareness, acreage, credit, other agricultural expenses and other incomeshave had a significant effect on the demand for the insurance of agricultural products.The findings related to the evaluation of performance of AIF showed that theAIFhas had a large distance to independency and the amount of compensation paid to farmersis considerably less than the received premium.