Working Paper BETA #2023-25

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Title : Subjective barriers and determinants to crop insurance adoption

Author(s) : Richard KOENIG, Marielle BRUNETTE

Abstract : Crop insurance has a low rate of diffusion among French farmers. In this context, the objective of the article is to identify determinants and barriers to crop insurance from the point of view of the farmers. We designed an original survey using different methodologies (questions, experimental tests, self-ranking, Likert scales, etc.). We carried out cross-sectional and dynamic probit regressions on crop insurance adoption. We show that the characteristics of the farm (e.g., surface area, certification, diversification) and the farmers (e.g., marital and tenure status) as well as behavioral variables (e.g., time preferences) have an impact on the adoption of crop insurance. In addition, we show that the characteristics of the contract play an important role in the decision to subscribe or not since the farmers who are not insured consider the premium and deductible level to be the main barriers, whereas the farmers who adopt crop insurance report recent loss and expect poor weather conditions for the incoming season. We discuss the results with regard to the current crop insurance reform in France.

Key-words : Crop insurance, Farmers, Determinants, Barriers, Survey, France

JEL Classification : Q12; G22