The Study Of Asymmetric Information Of Agricultural Insurance

Taking the asymmetric information theory, the game theory and the principal-agent theory as theoretical foundation, this study expounds the concrete manifestations and negative influences of the information asymmetry issue in Jiangxi agricultural insurance, using the nonparametric analytic method and the econometric model to demonstrate that there indeed is the adverse selection issue for peasant households in Jiangxi agricultural insurance and analyzing in detail and explored the concrete reasons for the information asymmetry in the Jiangxi agricultural insurance market.By learning from successful experience in solving information asymmetry issues of agricultural insurance at home and aboard and regarding the situation of Jiangxi, it proposes solving methods from the following three aspects.Firstly, resolve the problem of information asymmetry by improving the market system of agricultural insurance. It can be divided into four points: firstly, we need to improve the business environment of agricultural insurance market and to strengthen the propaganda and popularization of the relevant knowledge about agricultural insurance,thus forming an effective propaganda mechanism and establishing an awareness of integrity as farmers and insurers; the second is enriching the business entities of agricultural insurance market by means of mixed operation, liberalization of access mechanism of agricultural insurance and the increase of policy agricultural insurance agency; thirdly, the branches of agricultural insurance should be innovated by developing regional insurance, designing index-based insurance as well as setting up new branches of agricultural insurance based on each region; the fourth point is to establish an effective system for the supervision and management of agricultural insurance, and turn the farmers’ potential needs for agricultural insurance into actual needs through stern monitoring.Secondly, guard against the risk of moral hazard and adverse selection by expanding the news channels of agricultural production. It can be specifically divided into three points: the first one is that through the governmental cooperative mechanism and farmers’ reward and punishment mechanism to set up a mutual cooperation mode of agricultural insurance, which leads the settings of agricultural insurance organizations, establishment of types of insurance and recruitment of personnel to the local, sinking into the villages; second, local agents for agricultural insurance should be established, which will be elaborated in detail mainlyfrom three aspects such as qualification, business scope and commission; third, it can realize the transformation of agricultural production operators by building family fields and developing the new-type professional farmer’s cooperatives. Accordingly,the new demand subjects of agricultural insurance can be established to reduce the cost of getting information. Last, we can prevent the superposition of the market failure and government failure through introducing government into the agricultural insurance market. It is divided into four specific points: first, providing policy guarantee for the development of agricultural insurance by increasing the financial subsidy and tax benefits of the provincial government; the second, franchise clauses of agricultural insurance contracts should be improved through the methods of reducing the franchise ratio, the partition of insurance and the partition of franchise ration, protecting the interests of the insured farmers and preventing adverse selections and moral hazard; third, enriching the forms of indemnity-free policy,reducing the ratio upon the side of farmers bearing agricultural insurance cost, and increasing that of the government instead, so as to give incentives to the farmers to strengthen risk managements and push up the motivation of insurance company;fourth, we need to closely integrate the interest of insured farmers with the whole cooperative organization on the basis of the supporting system provided by the government of Jiangxi Province and to establish a cooperative agriculture insurance business model which is in line with the situation of Jiangxi Province, thus reaching the purpose of effectively resolving the asymmetric information in agricultural insurance.