New Approach to the Public Authorities’ Activities Development in the Crop Insurance System: Lithuanian Case

Abstract

This article substantiates the structure of the crop insurance system and describes the participants of the insurance system and their activities. The positive impact of crop insurance development on all participants of the system has also been clarified. The aim of the article is to present a methodology for assessing substantiated directs of activity for public authorities in order to make more active crop insurance system performance. The application of the proposed methodology can help to activate crop insurance processes and to expand farmers’ activities and achieve better commercial results of insurance companies. It has been proven that it is beneficial for the public authorities to reinsure farmers’ crops and to refuse to pay direct payments to farmers for the losses incurred. The criteria selected for the assessment of the development directions are relevant to all participants of the insurance system. The research was carried out in a region of Lithuania in which the composition of agricultural business entities corresponds to the situation in the whole agricultural sector of the country. The identification of the insurance system participants and their functions, as well as the use of an expert assessment method with the application of quantitative data processing, showed directions for the activation of crop insurance activities.