Determinants of Life Insurance Penetration in SADC

This study aims to investigate variables that impact on life insurance consumption in 15 Southern African Development Community member states, using panel data for the period 1995 to 2013. The macroeconomic and demographic variables employed in the research are income, inflation, financial development, urbanisation, education, health expenditure, age dependency, life expectancy, institutional quality (independent variables), and life insurance penetration (dependent variable) in Southern African Development Community member states. The study employed the fixed effects and system general methods of moments techniques to estimate the panel data. From the findings, it is concluded that the demand for life insurance varies for each model. Generally, fixed effects estimations reveal different outcomes for each model; variables such as inflation, health expenditure, age dependency, and voice accountability, are significant in explaining life insurance consumption in the Southern African Development Community region. The system general methods of moments estimator results uncover different outcomes: variables such as lag of life insurance penetration, health expenditure, age dependency, corruption control, and regulatory quality, are significant in explaining life insurance consumption. In general, the study concludes that there are positive/negative and significant/non-significant relationships amongst variables for demand of life insurance. The study then makes policy recommendations, that Southern African Development Community countries should advance the variables that influence the demand for life insurance, and that policies for the protection of life insurance growth should be developed to grow a healthy insurance sector.

Grantor dc:publisher.institution

Graduate School of Business (GSB)

Year dc:date.issued

2018

Author dc:creator

• Nkotsoe, Leonard Motseakgosi

Advisor dc:contributor.advisor

• Alhassan, Abdul Latif

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/11427/28395

OAI identifier oai:identifier

oai:open.uct.ac.za:11427/28395