Agricultural insurance for small holder farmers in developing countries: What do we know?

Bidisha Barooah, Jo Puri, Bharat Kaushish, Ombeline de Bock, Jesse D’Anjou and Tatiana Goetghebuer

Why Agricultural Insurance?

• A possible way to break the vicious poverty cycle

• Does (can) it work?–Informal risk

mitigation–Other instruments

of risk mitigation

• What do we know about the state and quality evidence in this field?

• Where are the opportunities and challenges for researchers?

• What are the areas of interest for policy makers?

Objectives of this scoping study

Scope of our study• Impact evaluation studies and

systematic reviews• ‘Real’ products • LMICs• 1996-2015• Assessment of quality

/inputs

Systematic SearchManual search

Papers identified through manual search (e.g. snowball

searching, specialist websites)

Electronic searchPapers identified through electronic searching on electronic databases

10203 references

702 references identified

9501 references identified

5095 references excluded (screened for duplicates and

relevant title)

5108references

identified in total

Abstract screening

4866 references excluded (out of scope and/or inclusion criteria)

241 references

remain

102 acquisition of

reports10 reports not obtained

139 references excluded (131 based

on exclusion criteria, 6 duplicates, 2 no English version)

59included papers

Number of studies by intervention/product type

8c. Other Services, please specify

8b. Advice on risk management and extension services

8a. Financial literacy/ product training

7. Other Products (Specify)

6. Innovative/Improved product

5. Bundled Product

4. Social Protection Schemes

3. Agricultural Technology/Inputs

2. Informal risk mitigating financial instruments

1e. Direct Subsidy/Grant/Transfer

1d. Formal agricultural risk-related savi..

1c. Formal agricultural risk-related credit

1b. Index Insurance

1a. Formal Yield/Indemnity Insurance

0 5 10 15 20 25 30

Number of studies by outputs/outcomes

Take

up/D

emand

Adequ

acy o

f pro

duct

Use of p

rodu

ct

Renewal

Change

in fo

rmal

loans

Change

in fo

od co

nsumpti

on

Change

in pr

oducti

ve as

sets/

lives

tock

Diversi

ficati

on of

crops

Change

in pr

oducti

vity

Change

in in

come

Change

in ot

her fi

nancia

l risk

mitig

ating

instr

uments

Educa

tion

Female

farm

ers

Cost-effe

ctive

ness

0

5

10

15

20

25

30

35

40

45

50

Results I

• 32 studies are RCTs• Risk of bias• Other quasi-experimental methods do

better

Results II• 6 studies on insurance and food

securityCountry Variable Results Gendered

impactsEthiopia Reduced meals

(binary)Significant reduction

No

Ghana Self-reported reduced meals (binary)

Significant reduction

No

Mexico Consumption expenditure including food

Significant increase

No

Colombia Food consumption expenditure

No impact No

Senegal/Burkina Faso

Food insecurity index/ Meat and onions in diet

Significant increase

But uptake lower among women

India Qualitative input Unclear No

Discussion• Uptake of insurance is low• Median uptake of index insurance

33%, despite ‘encouragement design’Possible reasons for low uptake (ref: ILO)

• Liquidity constraints • Trust• Poor insurance

understanding/financial literacy

• Other risk coping strategies

• Behavioral factors

Very little discussion on

adequacy of the product

Conclusion

• IE of agricultural insurance on women has been not been studied much

• “Edge of MDE”• For credible gender effects sample

size need to double- costs four times

Thank you