Adoption of Agricultural Insurance Among Smallholder Farmers in Uganda

Despite its potential to accelerate and sustain climate change adaptation, demand for agricultural insurance remains low in many countries. Although many factors typically demand and supply related have been identified to affect adoption of agricultural insurance, they lack a clear and holistic conceptualization. Consequently, the authors analyzed the determinants for uptake of agricultural insurance from the demand and supply side perspectives with survey data on 380 small holder farmers in Bududa District, Uganda and key informant interviews. They applied chi-square tests and logistic regression to determine the statistical significance of the variables to adoption and their relationships. From the supply-side, adoption of agricultural insurance was found to primarily depend on and constrained by funding which manifest into the institutional and structural challenges, quality of data and the insurance products, as well as limited access to AI training with an ultimate negative impact on adoption.