Factors Influencing the Paddy Farmers’ Intention to Participate in Agriculture Takaful

Agriculture is an economic sector that is exposed to an array of risks such as climate change, pest's attack, disease and others. In its attempt to sustain and protect this sector, the Malaysian government in its budget 2013 has initiated an insurance plan to help farmers reduce losses resulting from natural disasters. Hence, this research aims to investigate the relationship between Attitude, Subjective Norms, Perceived Behaviour control, Perceived risk and Intention to participate in Agriculture Takaful. Apart from this, the research also aims to explore the risks faced by farmers as well as to analyze the farmers need to participate in this risk management plan. 120 respondents which comprise paddy farmers in Selangor and Kedah participated in this survey. Stratified random sampling is used to measure the attitude, subjective norms, perceived behavioural control, perceived risk and intention to participate in Agriculture Takaful. Pearson correlation is used to measure the relationship between variables. The results indicate that the severity of risks and most frequently experienced by farmers’ is caused by pests attack. Furthermore, the findings also explained that perceived risk and perceived behavioural control are the significant factors that influence farmers’ intention to participate in Agriculture Takaful. Findings from the study would be beneficial to Takaful operators, relevant ministries and policy makers to materialize the implementation of an Agriculture Takaful plan for this sector.