RESEARCH PAPER
WHAT CHARACTERIZES FARMERS WHO PURCHASE CROP INSURANCE IN POLAND?
 
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Uniwersytet Ekonomiczny w Krakowie
CORRESPONDING AUTHOR
Grzegorz Strupczewski   

Uniwersytet Ekonomiczny w Krakowie
Publish date: 2019-03-18
Submission date: 2018-10-24
Final revision date: 2019-01-21
Acceptance date: 2019-02-01
 
Problems of Agricultural Economics / Zagadnienia Ekonomiki Rolnej 2019;358(1):106–119
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ABSTRACT
Objectives:
The purpose of the paper is to compare population of farmers that bought crop insurance with farmers that are uninsured. Based thereon, the author identified features characterizing the insured farmers. These findings were applied to draw more general conclusions concerning factors influencing the insurance awareness and propensity to buy insurance coverage. Demographic, social and economic criteria, individual perception of risk, the loss ratio, and the willingness to pay the insurance premium were taken into consideration.

Material and methods:
The research was carried out on a nationwide sample of 150 agricultural producers from Poland holding a farm of at least 5 ha. We applied the CATI method to survey our respondents. The analysis of the collected data was carried out using descriptive statistics and U Mann-Whitney and Kolmogorov-Smirnov tests. In addition, the willingness-to-pay (WTP) valuation method was used to determine the acceptable crop insurance premium.

Results:
It was found that farms with greater production volume (annual income) and with a larger crop area present higher willingness to buy insurance. Farmers who experienced damage to crops are more inclined to buy insurance coverage. Moreover, higher insurance penetration rate can be found among farmers who are willing to pay a higher price for a crop insurance policy. Surprisingly, despite frequently formulated assumptions, variables such as age of farmer, level of education or individual perception of risk do not determine the decision on insurance purchase.

Conclusions:
The results showed here may be used by policymakers to shape the policy of support for crop insurance market.

eISSN:2392-3458
ISSN:0044-1600