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Uptake of Crop Insurance among Smallholder Farmers: Insights from Maize Producers in Kenya

Author

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  • Njue, E.
  • Kirimi, L.
  • Mathenge, M.

Abstract

In spite of agriculture being an important source of income growth and a potential source of investment opportunities in Kenya, farmers face numerous production risks including climate change and variability. While literature suggests that crop insurance has the potential to unlock key services that enhance farm productivity, crop insurance uptake evidence is limited, hence, this study sought to inform on ways of making crop insurance work for the smallholder producers. Data was collected from 400 maize-producing households in areas where weather index-based insurance had been promoted. Results show that uptake of crop insurance is very low and declining and, the insurance concept is also not well understood by farmers. In addition, basis risk hinders uptake of crop insurance since farmers exhibited high levels of dissatisfaction with claim payments. Furthermore, awareness and training on crop insurance, density of automated weather stations and ownership of savings account are integral factors in enhancing its uptake. Our findings therefore highlight the need to educate farmers on the principles of crop insurance and different products that exist. Similarly, designing of crop insurance products and selection of target crop enterprises should involve all stakeholders to enhance uptake. Acknowledgement :

Suggested Citation

  • Njue, E. & Kirimi, L. & Mathenge, M., 2018. "Uptake of Crop Insurance among Smallholder Farmers: Insights from Maize Producers in Kenya," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277023, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae18:277023
    DOI: 10.22004/ag.econ.277023
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    References listed on IDEAS

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    1. Kassie, Girma Tesfahun & Erenstein, Olaf & Mwangi, Wilfred & La Rovere, Roberto & Setimela, Peter S. & Langyintuo, Augustine S., 2012. "Characterization of Maize Production in Southern Africa: Synthesis of CIMMYT/DTMA Household Level Farming System Surveys in Angola, Malawi, Mozambique, Zambia and Zimbabwe," Socioeconomics Program Working Papers 147108, CIMMYT: International Maize and Wheat Improvement Center.
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