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Determinants of Life Insurance Demand: Empirical Evidence from BRICS Countries

Author

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  • Mmakgabo Pinkie Segodi

    (Department of Finance Risk Management and Banking, University of South Africa (UNISA), P.O. Box 392, Pretoria 0003, South Africa)

  • Athenia Bongani Sibindi

    (Department of Finance Risk Management and Banking, University of South Africa (UNISA), P.O. Box 392, Pretoria 0003, South Africa)

Abstract

The life insurance industry has experienced phenomenal growth over the years. The broad aim of this study was to establish the variables that influence the demand for life insurance in the BRICS countries (Brazil, Russia, India, China and South Africa). Although many studies have investigated the determinants of life insurance demand, little research has considered the supply-side factors such as financial regulation. Therefore, this study also contemplated the effect of the financial regulation variable on life insurance demand. The inquiry employed a panel of the BRICS bloc of countries as a unit of analysis for 1999–2020 and applied panel data econometric techniques. The study found that the life insurance demand variable (proxied by life insurance density and alternatively by life insurance penetration) was negatively affected by income, unemployment, interest rates and inflation variables. Furthermore, the study documented a positive relationship between life insurance demand and the economic growth and financial freedom variables. This study implies that regulatory authorities should deregulate the life insurance sector to foster financial freedom.

Suggested Citation

  • Mmakgabo Pinkie Segodi & Athenia Bongani Sibindi, 2022. "Determinants of Life Insurance Demand: Empirical Evidence from BRICS Countries," Risks, MDPI, vol. 10(4), pages 1-14, April.
    • Handle: RePEc:gam:jrisks:v:10:y:2022:i:4:p:73-:d:784867
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    References listed on IDEAS

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    Cited by:

    1. Ling Tian & Haisong Dong, 2022. "Family Life Cycle, Asset Portfolio, and Commercial Health Insurance Demand in China," IJERPH, MDPI, vol. 19(24), pages 1-18, December.
    2. Striani, Fabrizio, 2023. "Life-cycle consumption and life insurance: Empirical evidence from Italian Survey," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 619(C).
    3. Siti Nurasyikin Shamsuddin & Noriszura Ismail & R. Nur-Firyal, 2023. "Life Insurance Prediction and Its Sustainability Using Machine Learning Approach," Sustainability, MDPI, vol. 15(13), pages 1-20, July.

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