Economists regard microinsurance-ultra-cheap policies for those on low in-comes-as a useful tool to promote rural development in poor countries. Research has shown that it helps smooth income shocks in farm households and boosts agricultural investment and productivity. But crop insurance has failed to take off in much of the developing world. In 2012 only 2.5% of Africans used microinsurance, according to the International Labour Organisation. The policies' administrative costs often exceed the benefits they produce, says Jerry Skees at the University of Kentucky. To make crop insurance attractive to farmers in America, Canada and India, premiums are currently subsidised by over 50%. Such support would be unaf-fordable for poorer African governments.
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