Study On Farmers’ Adverse Selection In The Market Of Planting Insurance In BaoTou

Agriculture insurance is one of the most important ways to disperse agricultural risk,known as on of the three backbones to support agriculture combined with rural finance and agricultural science. As a vital city of Inner Mongolia, Baotou has started policy agriculture insurance since 2007,and has made great achievement based on the support of government finance leading to the showing up of the function of agriculture insurance to agriculture. However, many problems blocking the development of agriculture are exposed. Scholars of home and abroad unanimously agree that adverse selection resulting from the asymmetric information is one of the factors to hindering agriculture insurance. This article analyses the existence of adverse selection based on Investigation to four counties in Baotou taking example of planting agriculture and applying to empirical way. The result is that adverse selection does exist in planting insurance but it is not serious. And the article analyses the reason of why it is not serious from three points which are that the hypothesis of asymmetric information is not perfect, propitious selection and the government subsidies to premium. Finally this paper analyses the problems faced by planting insurance and gives suggestions to solve those problems to promote planting insurance of Baotou.