This study aimed at analyzing farmers' willingness to proceed with the drought insurance contracts in Bunda district. Relationship between the market force factors and the outcome variable was modeled to determine the explanatory variables that influence farmers' willingness to proceed with the drought insurance contracts using Ordinal regression statistical technique. It was revealed that, reluctance to proceed with insurance contract was expressed by majority of farmers in drought insurance

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... lot program. Farm size, age, trust on insures, contract farming experience as well as satisfaction about the drought insurance contracts services were found to be statistically significant factors influencing farmers' willingness to proceed with the drought insurance contract in a subsequent year. Efficiency by the private investors and government's proper support will help farmers realize risk reduction benefits of the program and ensure its sustainability.