Sokoine University of Agriculture

Agricultural production risks, coping mechanisms and potential for crop insurance in Tanzania

Show simple item record Akyoo, A. M. Temu, A. E. Hella, J. P. 2021-01-13T12:49:30Z 2021-01-13T12:49:30Z 2013
dc.description Time Journals of Agriculture and Veterinary Sciences Vol. 1(1) pp.11-22 July 2013 en_US
dc.description.abstract Pessimism surrounding feasibility and viability of crop insurance schemes especially to developing country economies has since been a global phenomenon. However, pragmatic evidence is turning the clock around as more such schemes are now being launched. There have been very few studies on the subject in Tanzania which have not translated into a tangible full-fledged scheme to date. New evidence is unfolding now as shown in this study that its potential is substantive if the existing gaps in terms of information imperfection and asymmetry in respect to its marketability and viability, especially on insurers‟ side, are filled. Crop insurance potential was confirmed in the study involving 116 bean farmers in Arumeru district during the 2003/04 season. Both objective and subjective conditions for its need were fulfilled according to the study results. In the first case, about 76% of the farmers preferred crop insurance to other mitigation strategies against natural hazard risks. Pests and disease surfaced as the most debilitating risks to the farmers followed by drought. However, Pests and plant diseases are farm management problems which are not insurable. In the second case, profitability levels differ between individual farmers and locations across the three study villages from both rain- fed and irrigated areas. Both profit and loss making farmers were available from any of the villages. As a proxy for farmers‟ ability to meet insurance costs, profitability results suggested that not all bean farmers were capable of meeting the involved costs. Binary logistical regression analysis results, rather unexpectedly, indicated that the only significant factor influencing preference for crop insurance in the study area was asset index (a proxy for farmer‟ wealth). All 8 interviewed insurers (both public and private) were not ready to mount crop insurance schemes in the country claiming financial infeasibility of the scheme, lack of adequate market information and lack of requisite expertise. The study recommended the need to mount a crop insurance pilot program which would be initially funded by the Government, of specific peril and voluntary. This should go in tandem with introduction of insurance training in agricultural schools and colleges to increase its awareness to the target populace. Related studies hereafter have also confirmed crop insurance potential in tea and coffee and this paper has taken stock of the results. en_US
dc.language.iso en en_US
dc.publisher 2013 Time Journals en_US
dc.subject Agricultural Production Risks en_US
dc.subject Natural Hazards en_US
dc.subject Coping Mechanisms en_US
dc.subject Crop insurance en_US
dc.title Agricultural production risks, coping mechanisms and potential for crop insurance in Tanzania en_US
dc.type Article en_US
dc.url en_US

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