Extreme Weather Impact and Urban–Rural Income Gap: A Study on the Mitigation Effect of Agricultural Insurance Based on Provincial Panel Data in China

In recent years, the frequency, damage and impact scope of extreme weather events have increased and expanded significantly. Based on the official secondary panel data of 26 provinces in China from 2006 to 2022, this paper explores the impact of extreme weather on the urban–rural income gap. Employing benchmark regression, mediating effect and moderating effect models, this study empirically analyzed the transmission mechanism by which extreme weather affects the urban–rural income gap through crop damage caused by disasters and the mitigating role of agricultural insurance. The key findings reveal that extreme weather significantly widens the urban–rural income gap, with the severity of disaster losses serving as the primary transmission path. Furthermore, agricultural insurance effectively mitigates this shock by hedging against the loss of rural residents’ disposable income. Heterogeneity analysis shows that extreme precipitation and droughts exert the most pronounced effects, and the widening of the income gap is particularly significant in the western region of China. Consequently, it is imperative to promote the integration of meteorological services and agricultural insurance risk reduction services, improve the core infrastructure of rural disaster resistance, and build a differentiated agricultural insurance policy system for risk zones to narrow the income gap between urban and rural areas.