The Research For The Moral Hazard Prevention Of China’s Agricultural Insurance

In our country, the fundamental position of agriculture in national economy determines the agricultural insurance is the most affordable one in property insurance. Agricultural insurance is related to the welfare of the whole society. So agricultural insurance must be taken seriously. With the development of agricultural insurance in our country, the moral hazard problems are emerging constantly. Moral hazard of the insured farmers has been around forever. The agricultural insurance of our country has the government-led, fiscal subsidy system. Under the government’s fiscal subsidies, the problems of moral hazard caused by insurance companies and local governments become very common.This paper takes the example of the inspection of an insurance branch of PICC in the departments of Henan province in 2013.The Ministry of Supervision found several illegal facts. The causes of the moral risk in agricultural insurance include commercial operation defects of agricultural insurance, agricultural insurance laws and regulations and the system are not sound and the low quality of a handful of agricultural insurance practitioners and grass-roots government staff and the low insurance rate. These aspects are the main reasons that result in the moral risk in agricultural insurance.Mountain, can offend jade. Dealing with the moral hazard of agricultural insurance, we can’t copy the foreign experiences, but we can take its essence and learn the ways which are suitable for our country to solve problems. In this paper, through the comparison of the mode of agricultural insurance, the government responsibility and the legal regulations in the United States and Japan, we can learn the inspirations to deal with the moral hazard of agricultural insurance in our country.According to the situation of our country and combining the experiences abroad, advices are offered on how to prevent moral hazard of agricultural insurance in our country. First, perfect the agricultural insurance laws and regulations and form effective regulatory system. Strict laws and regulations make the operation of agricultural insurance normal. Second, clarify the responsibilities of the government which can’t interfere in the business management; the government should support the insurance company in policy and technology; raise the enthusiasm of farmers to join agricultural insurance. Again, insurance company should improve the level of management, make the design of the insurance contract reasonable, strengthen product innovation and service innovation. Finally, the reasonable choice of the mode of development is very important for agricultural insurance.