Inetrrelationship between General Insurance Premium and Macroeconomic Performance
Date Issued
2009
Date
2009
Author(s)
Hou, Tzu-Wei
Abstract
Human beings live in an environment of both natural and artificial factors, the latter including historical and social ones. The environment is much more complicated than other creators’ living structures. Among all the factors, insurance system is one unique part of the economic system, an evidence of human’s highly development and civilization. Insurance system closely relates with economic life. Insurance system is created because households or companies pay less money for the accidents and expenses in the future. Owing to insurance system, even if the insured encounter unexpected accidents, they will receive economic compensation and relief and continue their economic activities. This is the spirit of insurance system.he development of insurance industry in a certain country is very determined by its economy. Business development and public construction require large amount of money and insurance companies accumulate enormous lots reserve. If the reserve can be well invested to support the needs of enterprises and the government, insurance companies would have better returns while the economy would be driven. Generally speaking, the insurance industry grows when the economy is blooming but slows down or even depresses when the economy is slow. In addition, the insurance companies’ investment in real estate and stock market will stir the growth; the insurance companies’ financing to enterprises will drive their development. Therefore, insurance not only provides economic protection but also stimulates economic growth due to wise capital utilization.n Taiwan, premium income of general insurance companies is closely related with macroeconomic variables, such as economic growth rate, consumer price index, import and export trade, oil price, and etc. To discuss their interactive relationship, the study is to create an experimental model by use of quantitative methods including unit root test, correlative analysis, causality test and VAR model test. The study finds out the factors that mainly determines premium income of general insurance industry. With the study result, we can predict the future development of insurance market based on macroeconomic factors and formulate general insurance operation strategy; we can also predict the future economic development based on general insurance development for the government to plan proper laws and strategy.
Subjects
Insurance System
Economic Growth Rate
General Insurance Premium
Unit Root Test
Causality Test
VAR Model Test
General Insurance Market
SDGs
Type
thesis
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