Factors Affecting Adoption of Agricultural Insurance among Rahad Scheme Farmers, Sudan (2014)

Abstract

The Sudan has a cultivable area of about 175 million feddans. The agricultural sector has a considerable contribution in G.D.P.The Rahad Scheme (347,000 feddans) is considered as one of the major projects that grow cash crops and a pioneer in the application of agricultural insurance. The main objective of this study was to assess the factors affecting adoption of agricultural insurance among Rahad Scheme farmers in block3. A field survey was utilized as a research methodology for the study, and 215 farmers were selected randomly from block3 which consisted of five villages. A questionnaire consisting of eighteen questions was used. The collected data were analyzed using statistical package for social sciences for calculation of frequency distribution and percentages (descriptive statistics) and Chi-square test was used to find out relations between dependent and independent variables. The results showed that 60% of the respondents were educated and 51.2% explained risk avoidance as the purpose for adopting agricultural insurance. Also, 38.1% of the respondents had their sources of information about agricultural insurance from the field inspector. Also, 27.4% of the respondents said that the insurance premium was high and this was considered as a problem preventing them to adopt agricultural insurance. The study showed that there was no significant association between number of times of insurance and the sources of farmers information about agricultural insurance and contribution of the agricultural insurance in solving the financinial problems. The results showed that there was a high significant association between number of times of insurance and the level of productivity. The study showed that the information about agricultural insurance was inadequate for the farmers and facilitation of insurance applications procedures will assist in the continuation of insurance process. The high premium cost was found as one of the most important problems facing the farmers. For the continuity of insurance, the study recommends that insurance companies facilitate insurance application procedures. It was also found that expanding insurance purposes will encourage more farmers to adopt agricultural insurance and help them to build comprehensive relationship with insurance companies. For consolidating insurance culture, the study recommends that Rahad Scheme management should train extension field staff adequately on insurance and equip them with the necessary transport, audio visuals and multimedia to accelerate the adoption of agricultural insurance among farmers.