The Empirical Study On The China's Life Insurance Demand And It's Influencing Factors

Since the 1980s, China's life insurance industry has witnessed incredible growth. The mergence of new investment life insurance products has enriched the types of Life Insurance Products, and now life insurance has become an important industry of national economy. The average annual growth rate of China's life insurance is more than 30% since 1990. The China's total life insurance premiums in 2010 came to 1.063233 trillion Yuan, and increased by 300 times compared with 1990. The global average life insurance density and penetration in 2009 was $341.2 and 4% respectively while China's life insurance density was $81.1 and insurance penetration was 2.3%, which means there is a huge gap between China and the world average. Thus, China's life insurance faces the problem of insufficient effective demand.According to the existing research on the theory of life insurance demand and taking into account of the actual status of China's life insurance demands, this paper reviews and comments the existing theory of life insurance demand. In the empirical research, this paper use stepwise regression method to analyze how the determinants, including gross domestic product, interest rates, price index, educational level, the burden of old age, the burden of children, the market concentration ratio, to influence the demand of life insurance. The empirical results show that the life insurance demand is positively correlated to GDP, the burden of children, the burden of old age and products innovation. Education level and expected rate of inflation has a weak impact on life insurance demand. Based on qualitative and quantitative analysis, this paper makes a few suggestions for government, insurance companies and individuals respectively.