Feasibility Study for the Development and Implementation of Index-Based Crop Micro-Insurance for Cotton Farmers

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The aim of this feasibility study is to examine the potential and feasibility for index-based crop insurance for the cotton sector in Tajikistan. The study was carried out after a methodology assessment was performed based on secondary data collection, field missions, focus group surveys, through direct and conference call meetings, as well as desk work analysis based on the DSSAT crop estimation model.

Establishing an Index Insurance Trigger for Crop Loss in Northern Ghana

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As a consequence of climate change, agriculture in many parts of the world has become a riskier business activity. Given the dependence on agriculture in developing countries, this increased risk has a potentially dramatic effect on the lives of people throughout the developing world especially as it relates to their financial inclusion and sustainable access to capital. This study analyses the relationships between rainfall per crop gestation period and crop yields and studies the likelihood of crop yield losses.

Weather insured savings accounts

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Through a laboratory experiment in India, this paper assesses consumers' relative valuations of savings versus insurance when planning for risky rainfall in an attempt to measure potential demand for a new type of financial product that combines savings and rainfall insurance, the Weather Insured Savings Account (WISA). The study finds out that participants prefer both pure insurance and pure savings to any mixture of the two, and that this preference is most pronounced among those who are more risk averse.

Weather indices for designing microinsurance products for small-holder farmers in the Tropics

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Agriculture is inherently risky. Drought is a particularly troublesome hazard that has a documented adverse impact on agricultural development. A long history of decision-support tools have been developed to try and help farmers or policy makers manage risk. Drought insurance works by encapsulating the best available scientific estimate of drought probability and severity at a site within a single number- the insurance premium, which is offered by insurers to insurable parties in a transparent risk-sharing agreement.

Risk, coping mechanisms, and factors in the demand for micro-insurance in Ethiopia

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This paper is the result of a policy study carried out for the International Labour Organization (ILO) and the United Nations Capital Development Fund (UNCDF), to determine how microinsurance can help Ethiopia’s poor become more resilient to negative financial shocks. The research focuses on the demand components of microinsurance, and investigates two main research questions: Do low-income households in Ethiopia need insurance? If so, would they be willing to buy it if it were made widely available?The study answered these two questions through a literature review and quali

Risk preferences and demand for insurance under price uncertainty: An experimental approach for cocoa farmers in Côte d'Ivoire

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This study analyses the willingness-to-pay (WTP) for minimum price insurance in Côte d’Ivoire cocoa farming and the potential role of risk aversion using both experimental gambling approach with real payoffs and contingent valuation (CV) method. The findings reveal a relatively high level of risk aversion among Ivorian cocoa farmers with more than 45 percent of the households exhibiting severe to extreme risk aversion The WTP analysis reveals that farmers’ individual WTP for minimum price insurance are relatively low.

Research paper on agricultural decisions after relaxing credit and risk constraints

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The investment decisions of small scale farmers in developing countries are conditioned by their financial environment. Binding credit market constraints and incomplete insurance can reduce investment in activities with high expected profits. The authors conducted several experiments in northern Ghana in which farmers were randomly assigned to receive cash grants or opportunities to purchase rainfall index insurance, or a combination of the two.

Microinsurance decisions: Evidence from Ethiopia

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This study reviews evidence collected from a microinsurance field experiment in rural Ethiopia. The experiment involves collecting data from individuals in order to predict the shape of the demand curve for indexed insurance. The study finds that the relationship between demand for index insurance and wealth levels is none linear and that individuals with intermediate levels of wealth have the highest demand while the richest and the poorest exhibited much lower demand.

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