Implementation of agricultural insurance for sustainable food crop in Mutiara Timur and Suka Makmur Sub Districts

The extreme climate has caused anomaly in rainfall, so there is the potential for floods and droughts to have a direct impact on the agricultural sector, particularly the decline in rice production. To overcome this, the government issued a policy in the form of an agricultural insurance program known as agricultural insurance to protect rice plants from the threat of crop failure. Aceh Province, which is one of the central provinces of lowland rice production in Indonesia, has implemented the agricultural insurance program since 2016, but it did not run smoothly due to several weaknesses of the program. Currently, agricultural insurance programs have developed rapidly, one of which is climate index-based agricultural insurance that can overcome the weaknesses of indemnity-based agricultural insurance. Based on the above background, researchers are interested in studying the Willingness To Join (WTJ) and Willingness To Pay (WTP) of farmers on climate index-based agricultural insurance. The analytical methods used are binary logistic regression analysis, Contingent Valuation Method (CVM), and Heckman Selection Models. The results showed that socio-economic factors namely farmer's age, experience in rice farming, land area, and income from rice farming had a significant effect on WTJ and WTP agricultural insurance premiums with an average premium was Rp168,667 ha⁻¹ per planting season. There are 2 things that the government needs to do to make the agricultural insurance program more successful. First, the application of cheaper insurance premiums and second, increasing farmers' knowledge about the insurance scheme through more intensive socialization.