This paper first discusses the conditions and bases of agricultural insurance development in China’s coastal areas. Then this paper theoretically analyzes the development effect of agricultural insurance in China’s coastal areas from the three following aspects:driving effect of government support,pulling effect of financial subsidy and promoting effect of regional economy. The empirical study in Shandong province shows that agricultural insurance expenditure has a positive and significant influence on agricultural development in China’s coastal areas. There are many remarkable differences between coastal agricultural insurance and traditional agricultural insurance. Agricultural insurances in coastal areas should emphasize the characteristics and advantages of coastal agriculture and pay more attention to policy agricultural insurance. Meanwhile，differences of developmental level and stage between China’s coastal areas and inland areas make the supply mode of agricultural insurance showing an obvious regional characteristics. The regional difference of agricultural insurance will exit for a long time.