Strategies for the Promotion of Agricultural Insurance Among Smallholder Farmers(A Case Study of Tabadakan Dehestan, Mashhad County)

Agricultural insurance is a risk management tool for the achievement of production goals, and a mechanism to create a safe environment for agricultural production revenues, to protect farmers against natural disasters, to ensure the sustainability of agricultural practices, and to maintain health, and accreditation mechanism in the agricultural sector. Research shows that agricultural insurance, despite decades of operation in Iran, has not been well received by farmers, especially smallholders, as a mechanism for protection of their products. As such, the level of insurance coverage for horticultural and agricultural products, far from the 50% coverage goal set for the country, is below 20%. Since agriculture is basically a risky economic activity, especially for smallholders, and the purpose of insurance is to promote a sense of security among farmers in a bid to properly and efficiently exploit the production parameters and make investment in new agricultural technologies, it is inevitable to offer strategies that can boost the demand for insurance. Accordingly, the present study aims to identify and prioritize the optimal strategies for the promotion of agricultural insurance among smallholder farmers.

This is an applied-developmental research that adopts a descriptive-analytical method. Data analysis was performed using two strategic management tools, SWOT and QSPM. Based on field survey and document analysis, 15 merits and 23 constraints associated with the expansion of agricultural insurance coverage among smallholder farmers were identified. In addition, ideas of 160 farmers with and without insurance were sought using a questionnaire on a five-point Likert scale. Data analysis was performed using SPSS, EXCEL and Arc Gis software. Cronbach's alpha coefficient of the questionnaire was estimated at 0.765, which indicates the good reliability of the research tool.

The final score of the internal and external factors evaluation matrix was computed for farmers with insurance (IFE = 2.329, EFE = 1.801), farmers without insurance (IFE = 2.301, EFE = 1.826), and all respondents in general (IFE = 2.313, EFE = 1.812). "Defensive" strategies were identified as the optimal strategy to promote agricultural insurance among smallholder farmers. Finally, using the quantitative strategic planning matrix, out of 10 strategies presented, "scientific explanation of obstacles to agricultural insurance promotion and sponsoring research on determinants of insurance acceptance by stallholder farmers" was introduced as the main strategy with a score of 4.5.

Considering that more than 60% of agricultural production units in Iran are smallholders, it is crucial to promote agricultural insurance among smallholder farmers using the proposed defensive strategies. In this regard, by overcoming internal flaws such as poor financial status and low income of smallholder farmers, inability to pay insurance premium, unfamiliarity of farmers with the operations and compensation of agricultural products by insurance companies, poor farm management skills, small-sized and scattered lands of famers, and external threats such as climate-related risks, non- competitive nature of agricultural insurance services, and poor quality of damage assessment by agricultural insurance companies, among other things, can contribute to the promotion of agricultural insurance among smallholder farmers.