Does Economic Freedom in Host Countries Lead to Increased Non-Life Insurance Development?

Abstract

The journey to reinforce connectivity between China and ASEAN-5 through the Belt and Road Initiative (BRI) presents various risks and non-life insurance development opportunities. This research investigates the factors that affect non-life insurance development in China and ASEAN-5. This study has offered novel evidence highlighting the impacts of trade variables and a multidimensional economic freedom measure consisting of nine components on non-life insurance development. Panel regression results indicate that trade and the BRI itself are decisive factors that stimulate insurance development. Higher economic freedom, however, has a negative influence on non-life insurance development. In terms of policy implications, regulatory interventions represent a more practical way to enhance the resilience and development of the non-life insurance sector to accomplish the BRI goals.