Understanding Farmers' Willingness to Participate in Organic Tea Cultivation Insurance: The Roles of Risk Experience, Information Asymmetry and Organizational Factors

Organic tea insurance is essential for protecting the livelihoods of tea farmers, yet its uptake remains limited due to a potential misalignment between the program's design and farmers′ objectives. This study used a discrete choice experiment to explore how risk perceptions and information asymmetry influence farmers' decisions to purchase organic tea insurance. It also assessed the role of farmer cooperative organizations in facilitating these decisions. We collected data from 323 tea farmers in Anhui Province to estimate their willingness to pay (WTP) for specific insurance features. The results indicate a preference for having organic tea insurance, especially among farmers who have experienced agricultural disasters and are informed about insurance options. However, participation in farmer cooperatives did not significantly enhance mutual understanding or trust in the insurance scheme. Using a random parameter logit model, we found that the WTP varied significantly with changes in the insurance claim starting point (by 1258.44 yuan ha–1) and the government subsidy ratio (by 819.69 yuan ha–1). In contrast, modifications in claim payment timing and total indemnity affected WTP minimally, the impact of claim payment time on WTP is 19.70 yuan ha–1, and the change in total indemnity has an impact of 0.32 yuan ha–1 on WTP. Applying a latent class model, we categorized farmers into two distinct groups based on their attribute preferences and price sensitivities, which remained consistent across robustness tests using an attribute non-attendance regression. This study offers new insights into farmers' preferences and behaviors toward organic tea insurance, emphasizing the significance of risk experience and information symmetry in their decision-making processes.