Abstract
Abstract
Purpose
Non-life insurance is considered to have an advantage over traditional life insurance for some situations because it covers a variety of risks such as fire, theft, and casualty-related losses. However, poor government policy may negate the tendency for non-life insurance policy subscriptions. Considering this issue, the authors investigate the relationship between bureaucratic quality and nonlife insurance penetration. Institutional quality, innovation, and insurance align with the timeline of Sustainable Development Goals, SDG 16 (Peace, Justice, and Strong Institutions), SDG 9 (Industry, Innovation, and Infrastructure), and SDG 8 (Decent Work and Economic Growth). These goals together form the bedrock of financial resilience sustainable development
Methodology:
The sample of the present study consists of 420 country-year observations for 35 Sub-Saharan Africa (SSA) economies for the period 2009–2020. This study applies regression with a panel corrected standard errors (PCSEs) to examine the exigency of innovation on bureaucratic quality and non-life insurance penetration nexus, while Driscoll-Kraay estimation was utilized to check the robustness of the results.
Findings:
The study shows that the effect of bureaucratic quality on non-life insurance penetration is positive and significant. The study also finds that the association between bureaucratic quality and non-life insurance penetration is contingent on innovation.
Practical implications:
The findings will guide stakeholders to develop and implement measures that are capable of improving non-life insurance penetration in SSA countries. The findings demonstrate that bureaucratic quality is an essential determinant of non-life insurance penetration. Countries in the SSA region could increase non-life insurance penetration by fortifying the quality of their policy design and implementation. This study will also contribute to reduce the impact of adverse consequences of low insurance penetration among the citizens of emerging nations.
Uniqueness:
This is a premier study explaining the link between bureaucratic quality and non-life insurance penetration in the context of new institutional economics (NIE) and resource based view (RBV) theories.
Jel:C33, G22, G18, O30, N17