Agricultural Risk Insurance as a Tool for Improving the Economic Efficiency of Crop Production in the Context of Climate Change in Moldova

Abstract

Climate change and the increasing frequency of extreme weather events represent major challenges for agricultural production in the Republic of Moldova. Crop production is particularly vulnerable to climatic hazards such as droughts, hailstorms, and frosts, which generate significant fluctuations in agricultural output and farmers’ incomes. In this context, agricultural risk insurance plays an important role as a financial instrument for mitigating production risks and improving the economic efficiency of agricultural activities. The aim of this study is to analyse the role of subsidized agricultural risk insurance in strengthening the resilience of crop production in Moldova. The research is based on statistical data provided by the National Bureau of Statistics and the Agency for Interventions and Payments in Agriculture, covering the period 2013–2024. The results indicate a significant expansion of the subsidized agricultural insurance program after 2021, reflected in the increase in the number of insurance applications and the volume of subsidies allocated. The analysis also shows that hail, drought, and frost represent the most frequently insured risks, while the territorial distribution of subsidies reveals a strong concentration in several districts with intensive crop production. The findings highlight the importance of agricultural insurance as a policy instrument for reducing climate-related risks and enhancing the economic efficiency and resilience of the agricultural sector. UDC: 005.334:338.432(478); JEL: Q18, G22