This paper examines the short and long run dynamic relationships exhibited between economic growth and growth in the insurance industry for nine OECD countries. This is achieved by conducting a cointegration analysis on an unique set of yearly data for the level of real GDP and total real premiums issued in each country from 1961 to 1996. Causality tests are then also conducted whilst accounting for long-run trends within the data. The results from the tests indicate that in some countries the insurance industry promotes economic growth, and in other countries the reverse is true. These set of results indicate that these relationships are country specific and any discussion of whether the insurance industry does promote economic growth will be dependent on a number of national circumstances.

This paper investigates the determinants of consumption for one of the fastest growing financial products in Asia. We find evidence that increased provision of civil rights and political stability leads to an increase in life insurance provision. However, by utilizing various estimation procedures, a number of differences between the more developed insurance markets and those in Asia are illustrated. In particular, the estimated income effect is found to be far higher in Asia than in other countries. However, the size of this difference is reduced once political and legal factors are controlled for, suggesting that future insurance market growth in Asia may not exceed that in the rest of the world. The Geneva Papers on Risk and Insurance (2002) 27, 395–412. doi:10.1111/1468-0440.00181

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This article examines the importance of legal rights and enforcement in influencing property-casualty insurance (PCI) consumption. We extend the existing literature by examining the role of legal factors in determining insurance density across countries. Also, measures of risk aversion, loss probability, and price, which overcome limitations of proxies used in the existing literature on insurance demand, are analyzed. Using a panel data set, we apply a generalized methods of moments dynamic system estimator, which relaxes the assumption of strict exogeneity of the regressors and produces unbiased and efficient estimates. The results show a strong positive relationship between the protection of property rights and insurance consumption, which is robust to various model specifications and estimation techniques. Moreover, the results show the purchase of PCI is significantly and positively related to loss probability and income, as well as providing weaker evidence of a negative relationship with price. Copyright The Journal of Risk and Insurance.

This article acts as a review and also a guide to policymakers who are interested in understanding the determinants of insurance demand and how it affects general economic development. By providing a synopsis and evaluation of existing empirical research on the development of insurance markets, this article provides a discussion of the factors that promote insurance market development. This article then highlights certain issues that both insurance companies and policymakers can utilize further in their own markets to design future policies that can be geared to promote insurance market development.