Vol. 9 No. 4 (2015)


More insurance subsidies for European farmers – is it needed?

Published December 30, 2015
Anna Lóránt
Faculty of Economics and Social Sciences, Doctoral School of Management and Business Administration
, Maria Farkasné Fekete
Faculty of Economics and Social Science, Institute of Economics and Methodology Szent István University
How to Cite
Selected stlye: APA
Lóránt, A. ., & Farkasné Fekete, . M. . (2015). More insurance subsidies for European farmers – is it needed?. Applied Studies in Agribusiness and Commerce, 9(4), 33–38. https://doi.org/10.19041/APSTRACT/2015/4/4

In addition to traditional sources of uncertainties, such as market price volatility and animal and plant health-related risks, the impacts of climate change have recently become a major concern in the agricultural sector throughout the world. Insurance has been commonly proposed as a key instrument in farm risk management, and agricultural insurance schemes have become more widespread both in developed and developing countries. We conducted a case study in the UK to investigate farmers’ risk perception and willingness to pay for crop insurance by using contingent valuation method (CVM). Similarly to the experience from developing countries, we found that farmers are less willing to pay for insurance, however they do take actions to reduce their risks. While these results suggest that the provision of premium subsidies to European farmers can be justified; in order to avoid counter-productive policy outcomes, one may consider the introduction of a risk-based approach in agricultural risk management.

JEL classification: Q14


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