Does Past Experience in Natural Disasters Affect Willingness-to-Pay for Weather Index Insurance? Evidence from China

Although numerous index insurance pilot programs have been conducted in China, little is known about Chinese farmers’ willingness to pay for index insurance. By using a field survey of small farm households in China’s Heilongjiang Province, which suffered a large flood in the summer of 2013, this paper explores farmers’ willingness to pay (WTP) for a hypothetical rainfall index insurance product, with a special interest in whether farmers affected by the flood are willing to pay more than those where not.