Empirical Study On Cultural Factors Affecting Life Insurance Demand

Recently,the development of the global life insurance industry is very uneven.The markets in developed countries still maintain large-scale and low growth rates.The emerging market keep small-scale and high growth rate.In 2017,China's life insurance market grew by more than 21%.The Latin American market was stagnant,and the growth rate of the largest UAE market in the Middle East fell sharply.The mainstream view is that economic,demographic and institutional factors are the main causes of these phenomena,but these factors do not explain the problem perfectly.This paper re-examines the impact of cultural factors on life insurance demand.On the one hand,it hopes to enrich the literature on life insurance demand.On the other hand,it hopes that the differences in the development of life insurance market in different countries can be explained through cultural.This paper uses the panel threshold model to analyze the relationship between culture and life insurance needs.The empirical analysis uses the economic,demographic and cultural data of 60 countries from 2007 to 2016 to verify the non-linear effects of cultural factors on life insurance demand.The study found that five factors of Hofstede's cultural dimension have a threshold effect on the impact of life insurance demand.Among them,Power Distance,Long Term Orientation and Masculinity are positively correlated with existence.Individualism and Uncertainty Avoidance have a negative correlation with life insurance demand.The Indulgence versus Restraint index has no significant impact on life insurance demand.The results show that the two factors of income level and government expenditure have a significant positive impact on life insurance demand.The impact of private savings and public education expenditure on life insurance demand is significantly negative.Urbanization level,life expectancy,elderly population dependency ratio,commercial bank density,interest rate and inflation rate,those six variables have no significant impact on life insurance demand.This study believes that when the national culture is characterized by high power distance,more collectivism,more masculinity,low degree of uncertainty avoidance and long-term value orientation.This cultural environment is conducive to the development of the life insurance industry.When an insurance company expands its overseas market,it needs to pay attention to the economic factors of the country as well as the influence of the cultural environment.The research results also confirm that Chinese culture is very conducive to life insurance consumption.The main driving force for the rapid development of the life insurance market is the Chinese economy,but the potential driving force could be Chinese culture.