Research On Interactive Mechanism Of Insurance Industry And Urbanization Development

Since the 16th congress of the Communist Party of China put forward the new urbanization strategy,the new urbanization construction in our country has made outstanding achievements,and the urbanization develop rapidly.Until the end of 2015,the urbanization rate has reached 56.1%.Along with the development of urbanization,many industries have the opportunity of rapid development,included the insurance industry which have the function of risk management.At the same time,there are many types of complex risks in the process of urbanization development,and social security level of migrant workers is insufficient.So the insurance industry will have great opportunities to develop.With the process of urbanization,China's social and economic environment has undergone significant changes.Increasement of income,promotion of educational level,enhancement of risk awareness and other factors will have a tremendous support effect on the demand of insurance.Firstly,promotion of the economic level will drive the increase of urban and rural residents' income,which will provide a solid economic conditions for the insurance consumption;Secondly,with the popularization of education,quality of people will have to take significantly improved and enhance risk awareness,so consumption of insurance will be increased;Again,the rural population gathered to urban areas constantly,and it's good for doing business of the insurance companies and developing of markets rapidly.Meanwhile,the financial system has been perfected constantly in the process of urbanization,and the more advanced system is good for offer better service for customers.Because centralization of the population has been greatly facilitated to the insurance company's business expansion;Finally,urbanization will promote agricultural modernization,then agricultural insurance will play a huge role in stimulating the consumption of insurance.At the same time,the insurance industry also guarantees the quality of urbanization from management of risks and investment of insurance fund.After the theoretical analysis,then we will build a comprehensive index system to reflect the level of urbanization development better through factor analysis.By comparison of the level of urbanization development between provinces,we found the development of China's urbanization have obvious regional imbalances.Then,select the insurance density and insurance penetration as the dependent variable,to build mixed-effects model,and the empirical results show that four urbanization comprehensive index and insurance density are highly correlated.But there is no strong correlation between insurance penetration and urbanization comprehensive index.At the same time,correlation between four urbanization comprehensive index and the property insurance density is higher than the life insurance density.In the other words,the level of urbanization will have a greater impact on property insurance.Then,by constructing impulse response functions,the results showed that:with the gradual expansion of insurance density in various regions,the rate of urbanization will lead to be prosperity,and gradual increasement of urbanization rate will also lead to rising of the insurance consumption.Thus,forming comprehensive interaction mechanism between urbanization and insurance development.Finally,this paper analyzes the plights of the interaction mechanism of the insurance industry and urbanization,and puts forward some policy recommendations according to these difficulties.