Factors Affecting the Adoption of Agricultural Insurance and Providing the Sustainable and Unsustainable Insurance Model

Food Provision is one of the main concerns of mankind. To achieve food security, governments design policies to increase the production capacity and reduce risks in agriculture. Agricultural insurance is a suitable mechanism to reduce economic risk and promote national food security. This research has been conducted to investigate and analyze the effective factors on purchasing the soybean insurance with the purpose of sustainable development in agricultural production in Gorgan district. The survey data was collected by designing and completing questionnaires from a sample of 183 soybean farmers in five rural districts that were selected via classified random sampling. Also, some data was gathered from documentary information of Agricultural Insurance Fund and Oil-bean committee. The econometric Logit model was used to determine the effective factors and their effectiveness on purchasing soybean Insurance by farmers. The results of Logit model estimation revealed that the educational level, getting loan, cultivation precedence, experience, age and risk experience of farmers had positive effects on insurance adoption, but revenue, revenue diversity and having agricultural production as the main job, land ownership for soybean farmers and production diversity had negative effects on insurance adoption. Amounts of marginal effects of variables showed that the insurance adoption probability will increase %0.071 by a %1 decrease in soybean acreage, meaning that smallholders have more tendency to insure their products. This is in accordance with the approach of Agricultural Insurance Fund in smallholders. Finally, the following are recommended to policymakers and planners to improve the efficiency of Agricultural Insurance Fund and insurance adoption rate in order to improve input usage and get closer to production development path: establishment of farmers and experts information bank in insurance fund, changing insurance encouraging policies such as supplying the subsidized detrimental inputs, and establishing an independent extension system in insurance fund.