The Study Of Commercial Insurance Types On Household Risk Financial Asset Allocation

As the basic unit of society,family plays an important role in economic activities.Residents asset portfolio management situation not only influence the fortune of the family but also the whole country.Benefit from the reform and opening up policy,Chinese is getting richer and household has more savings than before.However,Chinese families prefer to hold low risk and risk-free assets.Government report clearly proposed to expand the channels for residents accumulate their income from financial market.Only invest in lower risk or risk-free assets cannot help residents maintain or increase the value of their assets,which will also contribute little to the country’s prosperity.Therefore,by studying the choice,influencing factors and mechanism of household financial assets,we hope to promote household participates more in risk financial market and accelerating capital market reform,diversifying household asset portfolio and enhancing household well-being.In order to ensure that the normal life of the family is not affected by sudden accidents which often cause family income declines,more and more families choose to purchase commercial insurance to against this risk.This paper studies different types of commercial insurance and find out how they impact a family’s investment decision on risk financial assets.This paper firstly defines the core concepts of commercial endowment insurance,commercial medical insurance,family finance and family asset portfolio management.The relevant domestic and foreign literatures are reviewed and summarized.Then it summarizes the current situation of commercial insurance and household asset portfolio management.Three basic theories which are modern asset portfolio theory,life cycle theory and behavior financial theory are introduced as well.Apply data from the China Family Panel Studies(CFPS)of 2018,a survey was conducted on the demographic characteristics,work,household assets and liabilities,and income status of family members.This paper uses Stata software to analyze the impact of commercial insurance types on the choice of household risk financial assets through Probit and Tobit regression models,and uses the method of replacing explanatory variables to test the robustness.The research shows that:(1)Participate in commercial endowment insurance has a significant positive impact on the participation in the risk asset market and the proportion of risk assets,which means that holding commercial endowment insurance significantly improves the probability of household participating in the risk asset market and holds more proportion of risk assets.(2)Participate in commercial medical insurance has a significant positive impact on the participation in the risk asset market and the proportion of risk assets,which means that holding commercial medical insurance significantly improves the probability of household participating in the risk asset market and holds more proportion of risk assets.(3)The demographic characteristics,work,household assets and liabilities,and income status of family members all have varying degrees of influence on participating in risk financial market.