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Weather Risk and the Viability of Weather Insurance in Western China

Published by:
Online Location
Publication date
Number of Pages
Type of Publication:
Event Reports
Focus Region:
Asia and the Pacific
Focus Topic:
Climate / Weather / Environment
Type of Risk:
Weather & Climate related
Type of Risk Managment Option:
Risk transfer
Risk coping
C. G. Turvey, R. Kong, B. Belltawn
American Agricultural Economics Association

This paper presents preliminary results on the possible demand for weather insurance in China and examples and discussion of how weather insurance can be implemented. Results from 1,564 farm households from Western and Central China between October 2007 and October 2008 suggest that the greater risk for farmers is drought followed by excessive rain. Heat is less critical as a risk but more significant than cool weather. Results suggest a strong interest in precipitation insurance with 50% and 44% of respondents indicating strong interest in the product. Supplementary results indicate that interest is equal between planting, cultivating, and harvesting. Furthermore results suggest that farmers are willing to adopt new ideas, and where possible already take action to self insure through diversification and other means.