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UCL Institute for Risk and Disaster Reduction

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Xuanrong Wang

Agricultural insurance in China

Agriculture in China is vulnerable when facing some natural hazards such as floods, droughts and hail. It would not only claim a heavy human toll in the countryside, but also destroy farm property like crops and livestock. Agricultural insurance as a special line of property insurance is a form of risk management used to hedge against a contingent loss, which develops cost-effective and sustainable programs for farmers to increase their financial resilience against extreme natural hazards.

This thesis will use penetration rate as the main index to investigate the development of China's agricultural insurance. There are several relevant research questions: (1) Why China has the current level of penetration rate and market growth of agricultural insurance? Can it be considered high or low compared to other levels worldwide and countries with the same or higher growth of GDP per capita? (2) Can be the current levels of insurance penetration be improved with the development of policies and incentives? (3) Can we show the significance of a model that tests whether some pilot measures can improve the current China’s agricultural insurance market or not? 

This thesis will adopt semi-structured interview and questionnaires regarding the agricultural insurance practitioners and the government staffs in China, as well as building a model to test the possible scenarios.