An Analysis of Life Insurance Demand Determinants for Selected Asian Economies and India

Subir Sen
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During the post-1990 period, services sector inmost of the Asian economies witnessed growth fuelled by substantial changes in the financial sector of these economies. The insurance industry, in most of the Asian economies, ASEAN and SAARC economies in particular, was publicly owned and remained isolated fromparticipation of either domestic private
insurers or foreign insurers or participation of both. But, regulatory reforms and policy changes in the ASEAN economies during the post-financial crisis period and the process of economic liberalization in some of the SAARC countries and China led to phenomenal changes in the growth pattern of the insurance industry in these economies. This study is divided into two parts: the first part is focused on four SAARC countries, two countries from Greater China Region and six ASEAN countries for the 11-
year period (1994-2004) to understand economic and other socio-political variables, whichmay play a significant role in explaining the life insurance consumption pattern in these economies. Secondly, an independent exercise is undertaken to re-assess whether or not the variables best
explaining life insurance consumption pattern for twelve elected Asian economies in the panel are significant for India for the period 1965 to 2004. Some variables were strongly capable of determining life insurance demand in both the analytical exercises. However, we also observed contradictions to earlier studies.