Small Farmers' Preferences for Weather Index Insurance: Insights from Kenya

Smallholder farmers in developing countries are particularly vulnerable to climate shocks but often lack access to insurance. Weather index insurance (WII) is a promising innovation, but uptake has been lower than expected. WII contracts are not yet sufficiently tailored to the needs and preferences of smallholders. We combine survey and choice-experimental data from Kenya to analyze an existing WII program and how changes in contractual design might encourage uptake. Better training, higher levels of transparency, and offering contracts to small groups rather than individual farmers would increase willingness to pay. Basis risk does not seem to be a major constraint.


Issue Date:
Apr 01 2017
Publication Type:
Working or Discussion Paper
Language:
English
Total Pages:
33
JEL Codes:
D81; O17; Q12; Q13
Series Statement:
GlobalFood Discussion Papers 93




 Record created 2017-04-19, last modified 2018-01-01

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