Poultry Farms Risk Management by Insurance: Evidence from Ghana

This study assessed poultry farmers’ decision to pay for poultry insurance in the Dormaa Municipality of Ghana, from a random sample of 100 commercial chicken producers. The paper employed the Contingent Valuation and Tobit models. The results showed that 72% of farmers are willing to pay GHS 31.00 or 3.10% on average of the chicken value of GHS 1000.00 ($263.52) to insure. Poultry farmers with multiple income sources tend to substitute insurance for other forms of occupation. The study found risk influence producers decision to insure because they have moderate frequency and impact. Prior experience with insurance, severity of disease serve as incentives for insurance and age serve as disincentive for agricultural insurance which require capacity building programmes to strengthen farmers demand for insurance whilst insurers take advantage of this potential market to sell viable insurance products.