Assessment of Poultry Farmers’ Willingness to Pay for Agricultural Insurance in Osun State, Nigeria

Fig. 1.

Fig. 2.

Variable description and their a priori expectations

Variable	Measurement	A priori expectation
1	2	3
AGE	Age of the respondent measured in years	+/−
GENDER	Gender of the respondent measured as a dichotomous variable. Male = 1 and female = 0	+/−
MSTAT	Marital status of the respondent. Measured as a dichotomous variable. Married = 1, otherwise = 0	+/−
EDU	Highest level of education of the respondent. Measured as a binary variable. Primary school education and above = 1, otherwise = 0	+/−
HHINCOME	Average monthly income of the household head as a proxy for monthly household income. It was captured as the reported monthly income of the household head from all income sources	+
PSCALE	Number of birds owned by the poultry farmer as at the time of the survey. The actual number of birds stocked at the beginning of the production period was used	+
HHSIZE	Household size of the respondent. Captured as a count variable representing the number of individuals in the household	_
POCCUP	Primary occupation of the household head. A value of 1 is assigned if the respondent identify poultry farming as his or her primary occupation and zero otherwise	+
EXPERIENCE	Signifies experience in poultry farming. Measured by the number of years the respondent has been involved in poultry farming	+
EXTENSION	Access to formal extension services. Measured as a dichotomous variable, taking the value of 1 if the respondent had any form of extension contact in the last two production seasons and zero if otherwise	+/−
CREDIT	Signifies access to credit. Captured as a binary variable, it assumes the value of 1 if the poultry farmer obtain any formal credit in the last two production season and zero otherwise	+/−
KNOW	Indicates respondents’ prior knowledge of agricultural insurance. It takes the value of 1 if the respondent indicate that he/she knew of agricultural insurance prior to the time of this survey and zero otherwise	+

Determinants of poultry farmers’ willingness to pay for agricultural insurance

Variable	Coefficient	Std. error	Z value	Marginal effect
Sex	−0.2046069	0.5145325	−0.40	−0.051089
Age	0.0387333	0.031699	1.22	0.0096715
Education	0.7918232	0.6909468	1.15	0.1903726
Marital status	−0.0320921	0.5949704	−0.05	−0.0080141
Household size	0.1807993	0.1356898	1.33	0.0451444
Experience	−0.119691	0.0548845	−2.18**	−0.0298861
Membership of FBO	−0.0075523	0.5680713	−0.01	−0.0018858
Primary occupation	0.8813643	0.534797	1.65*	0.2166569
Income	−0.6521644	0.5511621	−1.18	−0.1614532
Scale	−0.0007741	0.0003826	−2.02**	−0.0001933
Extension contact	0.0469701	0.6786567	0.07	0.0117281
Credit access	0.6980887	0.8107931	0.86	0.1713313
Knowledge	0.8506092	0.5409439	1.57*	0.2094264
Constant	−1.631959	1.482537	−1.10
Model fitness No of obs = 105 LR chi2 (13) = 24.97 Prob> chi2 = 0.0233 Pseudo R2 = 0.1718

Socio-economic characteristics of respondents (n = 113)

Variables	Frequency	Percentage
1	2	3
Gender (categorical)
Male	80	70.8
Female	33	29.2
Age (years)
18–30	29	25.7
31–45	45	39.8
46–60	35	31.0
>60	04	03.5
Mean	40.62
Standard deviation	11.73
Marital status (categorical)
Single	33	29.2
Married	74	65.5
Divorced	1	00.9
Widowed	5	04.4
Level of education (categorical)
None	04	03.5
Basic	14	12.4
Secondary	24	21.2
Tertiary	64	56.6
Postgraduate	07	06.2
Scale of production (ratio)
<100	31	27.4
100–300	35	31.0
301–500	15	13.3
>500	32	28.3
Mean	613.40
Standard deviation	782.64
Household size (ratio)
1–3	32	28.3
4–6	66	58.4
7–9	11	09.7
>9	04	03.5
Mean	04.62
Standard deviation	02.24
Occupation (Categorical)
Primary	44	38.9
Secondary	69	61.1
Experience (Years)
1–4	44	38.9
5–8	23	20.4
9–12	19	16.8
13–16	13	11.5
>16	14	12.4
Mean	08.30
Standard deviation	06.75
Monthly income (₦)
<50,000	33	29.2
50,001–100,000	51	45.1
100,001–150,000	21	18.6
>150,000	08	07.1
Access to extension services (categorical)
Yes	28	24.8
No	85	75.2
Access to credit (categorical)
Yes	19	16.8
No	94	83.2

Poultry farmers’ willingness to pay for agricultural insurance

Bid	Percentage (Frequency)
Not willing to pay	52.4 (55)
Willing to pay 10%	42 (21)
Willing to pay 20%	46 (23)
Willing to pay 50%	12 (6)