Farm Characteristics and Willingness to Pay for Livestock Insurance among Cattle Farmers in Tanga Region, Tanzania

Abstract

This study examined the association between farm characteristics and cattle farmers’ willingness to pay (WTP) for livestock insurance in Tanga Region, Tanzania. Guided by the Theory of Planned Behaviour (TPB), the study adopted a pragmatist philosophy and a cross-sectional explanatory mixed-methods design. Of the 385 targeted respondents, 380 provided usable questionnaires, while qualitative evidence was obtained from 15 key informants. Quantitative data were analysed using descriptive statistics and a probit model, while qualitative data were analysed in NVivo 14 using Braun and Clarke’s six-phase reflexive thematic analysis. The results showed that farm size, livestock breed diversity, and farm income were positively and statistically significantly associated with WTP. Farm size was positively associated with WTP (β = 0.072, p = 0.004), livestock breed diversity was positively associated with WTP (β = 0.194, p = 0.029), and farm income was positively associated with WTP (β = 0.00091, p = 0.001). Qualitative findings further indicated that livestock losses, diseases, drought, theft, veterinary costs, livestock value, and dependence on livestock income contribute to farmers’ perceived need for financial protection. The integration of quantitative and qualitative findings suggests that farm characteristics are important correlates of farmers’ willingness to pay for livestock insurance, particularly through differences in livestock ownership, economic exposure, and the potential consequences of livestock losses. The study recommends the development of risk-sensitive and scalable livestock insurance products, differentiated coverage according to livestock value and risk profiles, and stronger integration of livestock insurance with livestock-risk-management and extension services. The findings provide empirical evidence for policymakers, insurers, and livestock-sector stakeholders seeking to improve the relevance and accessibility of livestock insurance schemes among cattle farmers in Tanzania.