Macro-Economic Determinants of Life Insurance Business – Empirical Evidence during 2000-01 to 2015-16
V. V. N. Reddy1, S. M. Reddy2, P. A. Naidu3
1Dr. V. V. N. Reddy , Associate Professor, School of Management Studies, LakireddyBalireddy College of Engineering, Mylavaram, Andhra Pradesh, India.
2S. M. Reddy, Post-Doctoral Fellow, Department of Economics, Andhra University, Visakhapatnam, Andhra Pradesh, India.
3P. A. Naidu, Research Scholar, Department of Economics, Andhra University, Visakhapatnam, Andhra Pradesh, India.
Manuscript received on November 11, 2019. | Revised Manuscript received on December 02, 2019. | Manuscript published on December 30, 2019. | PP: 4599-4606 | Volume-9 Issue-2, December, 2019. | Retrieval Number: B5113129219/2019©BEIESP | DOI: 10.35940/ijeat.B5113.129219
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Abstract: There is a strong link between an institutional framework of insurance sector and sustainable economic growth. Insurance business has a positive impact on economic development and vice versa. As a developed insurance market stimulates economic growth of a country, the level of its economic growth affects insurance business development in return. In India, regulatory changes commenced since mid-nineties for opening up of insurance markets to private and foreign insurers. After more than one and half decade execution of insurance sector reforms, Indian life insurance business have been witnessed the better growth. In this juncture, the present study focuses on an examination of the role of a macroeconomic environment in the development of life insurance industry in India by using time series data with regression analysis. The study finds that the savings to GDP ratio, banking sector development, expenditure on social security to GDP, gross enrolment ratio and life expectancy are most significant and positive factors in driving the life insurance business during the study period..
Keywords: The study finds that the savings to GDP ratio, banking sector development.