Risk, premium, and agricultural insurance in developing economies

Jude Chidiebere Anago

University of Nigeria, Dept of Banking and Finance, Enugu Campus

Abstract

Agricultural insurance remains the most common form of risk transfer in agriculture. Many developing countries are beginning to embrace risk insurance because most of the available agricultural loans are tied to existing or willing to get an insurance package. Farmers are hesitance due to credit risk. Beyond credit risk factor, the hesitance among the farmers, who among many are worried about risk insurance lack of understanding. Against this background, this study investigates alternative risk insurance analysis and control using RIMEF an attempt at contributing to knowledge. Among the several outcomes, predicting risk occurrence and quantifying the risk for each of the agro–ecological zones of a country for a given period defined by the duration of the cover sought for the crops/livestock involved remains the study highpoint.

Key words. Agricultural insurance, Risk and loss, RIMEF, Premium, Developing countries