Game Model of Insurance and Moral Risk of Pig Breeders

  • Shajunyi Zhao
Keywords: Pig Farming, Breeding Risk, Moral Hazard, Game Model


With the development of the domestic market economy and the improvement of people's living
standards in recent years, not only the consumption of pork has increased rapidly, but also the safety and health
requirements of pork products have been increasing. Free-range is the main breeding method for pigs in China.
This breeding method enables the infected pigs to spread of pathogenic microorganisms and parasites constantly,
and the drug residues exceed the standard, which constantly threatens the quality and safety of pork. Farmers’
awareness of participating in insurance is still relatively low. The purpose of this paper is to analyze the
development status of animal husbandry insurance in China, and to analyze the factors affecting the animal
husbandry insurance and the behavior of pigs insured, understand the moral hazard and adverse selection issues
in the implementation of animal husbandry insurance, and explore how to strengthen risk research to build
commercial insurance for animal husbandry gradually and form a comprehensive animal husbandry insurance
system. Through the field research data to understand the current situation of pig insurance and farmers' views
on pig insurance, we found that farmers understand 70% of insurance; Combine theoretical analysis with field
research to find out the factors affecting farmers' participation in pig insurance behavior, combined with the data,
empirical analysis of the channels for farmers to purchase insurance, found that the proportion of channels
through the county, townships, townships, villages and village committees up to 60%; summarized and analyzed
the results and combined with the current situation of the development of China's hog insurance, achieved the
results of improving the participation rate of hog insurance. The results of the study show that age, income, scale
of farming, and the extent of farmers understand insurance can affect the participation rate of farmers.
Encourage farmers to carry out moderate-scale farming, strengthen insurance knowledge publicity, improve
China's pig insurance laws and regulations, and effectively promote the development of the pig industry.