Abstract

Kamran B. Khomeini, Parviz H. Omidyar and Hossein Daneshjoo

As farming is faced with uncertain conditions such as climate (rain reduction and drought), pests, diseases, production, price and market fluctuations, it is an economic activity under risk. In order to reduce risk and stimulate investment, agricultural insurance has been planned in agriculture. This study attempts to investigate the performance insurance of agricultural crops by collecting sectional information in the region of Sistan. A Tobit model was used to analyze effective factors on the demand of agricultural insurance. The results indicate that agricultural services insurance of crops has fluctuated because of several socioeconomic effects on farmers’ acceptance and demand of insurance in recent years. Annual return and experience are two main effective factors which affect farmers’ demands of insurance. The structural improvement and appropriate government policies can potentially increase the insurance of agricultural crops.