The agricultural sector, as importance as it is exposed to extremely high degree of disk arising out of natural factors like weather conditions. Uncertainties, regarding the quality and quality of the crop/livestock output due to natural hazards, are one of the basic risks that are constantly faced by every farmer. But majority of farmers are subsistence in natures and are seldom able to bear such risk especially when large loss involved. The information for the study was collected using primary and secondary methods of data collection. For the primary data collection, questionnaires, personal observations and oral interviews were used while existing literature relevant to the topic was consulted for the secondary data. The researcher used chi-square statistical model to analyze the data. At the end of the research work the researcher find out the following: that Agricultural insurance scheme has helped the farmers to get agricultural loans easily from the farmers to get agricultural loans easily from the financial institution by the use of her policy document, which banks accept as enough collateral security from farmers. Based on the findings the researcher made the following recommendations: Government provision of befitting accommodation for the NAIC that pilot the scheme. Since the scheme to established and 100% owned by the federal government, the government should assist in providing, benefiting accommodation for the office because of its importance to the Nigeria farmers, Government should assist the Nigeria Agricultural Insurance Corporation in the publicity of the scheme especially at the grassroots. This will encourage the farmers to go and take loan and invest it in agriculture without fear of uncertainlees, Before a farmer is qualified for a loan in agricultural bank/Commercial Banks, there is a minimum saving required by the bank to qualify you certain amount of loan. Guideline: Bank should be well acquainted with the modalities of the scheme so to educate their loaners in their local branches on the operations of the scheme.

TABLE OF CONTENTS

Title page i

Approval page ii

Dedication iii

Acknowledgment iv

Abstract v

CHAPTER ONE

1.0 INTRODUCTION

1.1 Background of the study 1

1.2 Statement of problem 5

1.3 Objective of the study 5

1.4 Research question 6

1.5 Research Hypothesis 7

1.6 Significance of the study 8

1.7 Scope and Limitation of the study 9

1.8 Definition of terms 12

CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.1 An overview 15

2.2 The meaning and concept of agricultural insurance 15

2.3 Historical background of agricultural insurance in other countries 18

2.4 Evolution of Nigerian agricultural insurance scheme 19

2.5 Reasons for low productivity and the effects of natural hazards in Nigeria agriculture 24

2.6 Risk in agricultural classification of these risks 26

2.7 funding and administration of agricultural insurance scheme in Nigeria 30

2.8 Basic agricultural insurance policies available in

the scheme 35

2.9 Beneficiaries and advantages of agricultural insurance scheme in Nigeria 38

2.10 Procedure for insurance 40

CHAPTER THREE

RESEARCH METHODOLOGY AND DESIGN

3.1 An overview 45

3.2 Sources of data 45

3.2.1 Primary data 46

3.2.2 Secondary data 46

3.3 Population of the study 47

3.4 Sample size of study and sampling techniques 49

3.5 Instrument in determining sample size 51

3.6 Validity of the instrument 51

3.7 Method of data presentation analysis 53

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

4.1 An overview 56

4.2 Data presentation 57

4.3 Data analysis 58

4.4 Testing of Hypothesis 68

4.5 Discussion of findings 76

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATION

5.1 Summary findings 78

5.2 Conclusion 79

5.3 Recommendations 81

5.4 Suggestion for further studies 83

Bibliography

Appendix

Questionnaire

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The principle feature, which distinguishes agriculture from other production sectors, is its great dependence on nature which itself is beyond man’s control. The agricultural sector, as importance as it is exposed to extremely high degree of disk arising out of natural factors like weather conditions. Uncertainties, regarding the quality and quality of the crop/livestock output due to natural hazards, are one of the basic risks that are constantly faced by every farmer. But majority of farmers are subsistence in natures and are seldom able to bear such risk especially when large loss involved. The decline in the supply of products in turn creates a shortage of inputs in other sectors of the economy; thus the entire economy is open to the serious consequences of agricultural risks of which the farmers, are most direct and primary victims. Most of these events that result in these losses are beyond the control or prevention by individuals or society as a whole.

It is therefore, important that devices be employed for minimizing the adverse economic effect of these natural hazards in agriculture. Not only lives and well being of individuals but also the economic viability of the entire nation may be at state.

Agricultural insurance is therefore the most important available device for minimizing the adverse effects of natural hazards. Agricultural Insurance Scheme is a collective system or scheme for reducing economic uncertainties through the basic techniques of risk pooling whereas the frequency of the severity of crop losses of individual farmers cannot be predicted, the predictability and severity of losses frequency is substantially increased when similar exposure of large number of farmers are pooled.

However, there are measures established to increase agricultural production and from income like the Agricultural Development Project (ADP), operation feed the Nation (OFN), the Green Revolution, the Nigeria Agricultural and Co-operative Bank and various River Basin Authorities in deferred states. These measures have not been with success because of the huge losses of agricultural production caused by natural disaster/hazards which has been the major constrains in increasing food production in Nigeria economy. Agricultural insurance therefore offers production to farmers (Insured) from the effect of these natural disaster and ensure payment of appropriate compensation sufficient to keep the formers in the business after suffering a loss. It minimizes and eliminates the need for emergency assistance provided by government during the period of agricultural disaster.

Agricultural Insurance Scheme is therefore; aimed at encouraging banks to be more liberal in extending agricultural credits to farmers for increased food production since their loans are under agricultural insurance policy cover. Most importantly, the scheme includes research and development which generates innovations that reduce risks of diseases, pets and yield losses in agricultural production and give protection to farmers. It provides financial support and increases the growth of agricultural credit from lending institutions and farmers. Therefore, farmers are encouraged to ensure their farm projects with Nigerian Agricultural Insurance Corporation (NAIC), so as to have more coincidence to embark on wider ranger of Agricultural productions.

1.2 STATEMENT OF THE PROBLEM

There has been so many problems associated with Nigeria Agricultural insurance cooperation in agricultural development in Nigeria. Some of such problem includes:

1. Nigeria Agricultural insurance cooperation are not adequately covering Agricultural risk.

2. Nigeria Government is not adequately funding Nigeria Agricultural insurance cooperation.

Famers in the rural Areas don’t even know the existence of Nigeria Agricultural insurance cooperation