Econometric Analysis of the Impact of Agricultural Insurance on Farming Systems in the Middle Belt, Nigeria (Report‪)‬

INTRODUCTION Peasant farmers are naturally keen to avoid taking risks which might threaten their livelihoods and this is often reflected in their farming practices. This behaviour influences the levels and types of inputs they use and the aggregate levels of output produced. They are often reluctant to adopt output-increasing practices if these increase their exposure to risk [1, 2]. At least notionally there is a trade-off between the levels of risk that farmers can withstand and the aggregate level of food production in a country. Recognition of this trade-off by policy makers has led to the introduction of programmes that attempt to address peasant farmers' aversion to risk. One such approach is to establish a scheme to offer insurance against agricultural risk. The introduction of agricultural insurance has continued to generate a keen interest among academics and politicians because of the volume of investment involved. There are many reports that have addressed the usefulness, implications and operational practices of agricultural insurance in different parts of the world [3, 4, 5, 6, 7].