The Impact of Digital Financial Inclusion on Insurance Penetration

The study aims to examine the impact of digital financial inclusion on insurance penetration. The rapid evolution of global financial services, particularly in mobile-based transactions, provides the backdrop for this comprehensive analysis. Using a sample of 120 countries over the period 2011–2021, the study employs a panel fixed-effects model to assess the relationships. Insurance penetration is measured as the ratio of total premiums underwritten in a given year to gross domestic product. Digital financial inclusion is captured through indicators of both access and usage of digital financial services. Access is proxied by mobile connections per 100 people, while usage is represented by variables such as mobile money accounts, internet-based payments, mobile utility payments, and receipt of salaries via mobile phones. The empirical results reveal that the percentage of adults with mobile accounts and those using the internet for digital payments are significant drivers of higher insurance penetration. These findings underscore the transformative impact of digital financial services on expanding insurance markets, carrying significant policy implications for promoting financial inclusion and enhancing the global insurance ecosystem.