Demand assessment and test of commercial viability of crop insurance in Bangladesh

The aims of the study presented in this paper are to assess the demand for and test the commercial viability of a crop insurance scheme in different natural disaster-prone areas in Bangladesh, as an alternative poverty alleviation and natural disaster mitigation strategy. In a large scale household survey carried out at the end of 2006, 3600 riverine and coastal floodplain residents in Bangladesh were asked for their preferences for crop insurance schemes using the double bounded contingent valuation (CV) method. For example, asking them for their willingness to pay (WTP) for crop insurance schemes to eliminate future catastrophe risks. We find crop insurance demand to be positively correlated with household head’s primary occupation, land ownership and size of agricultural farm…