Internet Usage And Household Commercial Insurance Purchases

In 2014,the State Council clearly pointed out that “the establishment of commercial insurance into an important pillar of the social security system” reflects the important position and role of commercial insurance in improving the multi-level social security system.Through international comparisons,although China is the second largest country in terms of premium income,the insurance density and depth are at a relatively low level on a global scale.Along with the growth of China's per capita disposable income,there is a potential for huge insurance demand.Many domestic scholars have explored the problem of household commercial insurance demand in China,and concluded that lack of self-protection awareness,lack of financial knowledge,biased awareness of insurance function,lack of trust in insurance industry,information asymmetry in insurance market and repeated supply are the main reasons for the lack of insurance demand in China.According to China Internet Network Information Center,as of December 2018,the number of Internet users in China has reached 829 million,and the Internet penetration rate has reached 59.6%.Research shows that popularity and application of the Internet have had a profound impact on society.Moreover,the development of China's "Internet +" has promoted the cross-border integration of the Internet and the financial industry,which may impact and influence the traditional financial industry to a certain extent.There is less literature on the study of financial product demand from the perspective of Internet usage.The literature on the use of Internet influencing household commercial insurance is especially lacking.Based on panel data from the China Family Panel Studies(CFPS)in 2014 and 2016,this paper analyzes the relationship between Internet usage and household commercial insurance purchases.The empirical conclusions show that Internet use significantly increases both the probability and degree of household commercial insurance participation;estimates using instrumental variable and fixed-effects models,as well as robustness tests using online time,mobile Internet,and replaced with the China Household Financial Survey(CHFS)data in 2013 for a separate study of life and property insurance indicate that the conclusions are robust and reliable.This effect mainly exists in low-income,high-education and rural families;and compared to urban households,rural households are more inclined to buy commercial property insurance and less likely to purchase commercial life insurance.Analysis of mechanism shows that internet usage increases the probability of family commercial insurance participation by reducing the cost of information search and improving the availability of insurance.However we don't find that Internet usage affect the purchase of commercial insurance by improving the social interaction.Therefore,in order to further accelerate the development of China's modern insurance service industry,not only does the government need to focus on promoting Internet coverage in rural areas and low-income groups,but also must continue to publicize and popularize insurance awareness and related financial knowledge.And insurance companies must make full use of the Internet platform to provide suitable insurance products according to the different needs of consumers.At the same time,we must strengthen the supervision of Internet insurance-related websites to ensure that various types of insurance information can be accurately and timely disclosed;open more consumer feedback channels,severely crack down on false information and online insurance fraud,and effectively protect the legitimate rights and interests of investors.