Research On The Impact Of Financial Literacy On Household Commercial Insurance Participation

With the increasing demand of households for wealth appreciation and preservation and risk prevention,traditional social insurance has gradually been unable to meet their needs.More and more households have begun to choose commercial insurance for financial asset allocation and risk management.So,does financial literacy affect household commercial insurance participation in residents?Therefore,this paper deeply explores the impact of financial literacy on household commercial insurance participation,in order to solve the current problem of low participation in decision-making and participation in commercial insurance for households in my country,to encourage households to actively participate in commercial insurance,and to guide households to optimize investment.Financial management behavior and commercial insurance allocation,so as to achieve the goal of preventing risks and sharing losses for resident families,and pointing out the direction for the gradual improvement of my country’s commercial insurance system and the innovation of commercial insurance products,and promoting the development of my country’s insurance industry,which has great theoretical and practical significance.On the basis of sorting out relevant research results at home and abroad,this paper condenses the theoretical connotation of residents’ financial literacy from three dimensions,including financial knowledge,financial ability,and financial awareness,and condenses residents’ family business insurance participation in decision-making and degree of participation from two dimensions.The theoretical connotation of family business insurance participation.On this basis,this paper deeply analyzes the impact mechanism of financial literacy on household commercial insurance participation,and puts forward research hypotheses.Then,according to the 2017 data of China Household Finance Survey(CHFS),the factor analysis method is used to construct the residents’ financial literacy index and measure its current situation,and the comparative analysis method is used to measure the current status of residents’ household commercial insurance participation.The results show that the level of household financial literacy,commercial insurance participation in decision-making and commercial insurance participation are all relatively low.Subsequently,this paper empirically analyzes the impact of financial literacy on household commercial insurance participation.The Probit model and the Tobit model are respectively used to empirically analyze the impact of financial literacy on the decision-making and participation of households in commercial insurance,and the endogeneity test is carried out.Influence of insurance participation in decisionmaking and degree of participation.The results show that: the higher the financial literacy of residents,the higher the decision-making and participation degree of their family commercial insurance;the residents with different financial literacy have different degrees of participation in various types of family commercial insurance,and financial literacy has the greatest influence on the degree of participation in life insurance.Health insurance comes next,and other insurances are the smallest.The study also found that through the heterogeneity analysis,there are differences in the impact of financial literacy on household commercial insurance participation in income,urban and rural areas,and regional differences;through the mediation effect test,total household income exists in the path relationship between financial literacy and household commercial insurance participation decision-making.mediation effect.Finally,based on the experience of foreign residents in improving financial literacy,this paper proposes to improve residents’ financial literacy from the perspectives of government departments,financial institutions,and residents themselves,so as to encourage residents’ families to actively participate in commercial insurance and improve their degree of participation.In order to help households achieve the goals of risk prevention and loss sharing,as well as promote the innovation of my country’s commercial insurance products,improve the commercial insurance system and achieve the vigorous development of my country’s insurance industry.