How Insurance market activity promote economic growth?
Marco Arena in 2006 made a study at the World Bank asking himself the question, how do insurance companies benefit economic growth? The answer is given by Anelena Sabater (2017) in her report "the insurance market has a positive effect on economic growth by making companies more solid and productive, mitigating risk. Insurance acts as a public policy, promoting access to basic services".
Insurance companies cause a greater demand for financial services and therefore encourage economic growth. The most developed countries insist on the need for each individual, company, institution, to have insurance. In search of lessening the consequences from the times of Babylon to the present, the human being needs to feel safe when carrying out any financial transaction, so much is the impact that in developed countries such as the United States the participation of insurers is prominent, having a positive effect on the Gross Domestic Product in the country.
According to data from the (AMIS) Mexican Association of Insurance Institutions, the financial solvency of the country's insurance companies is maintained, even after the negative impact that the global pandemic has had on the economy. The strength of these institutions creates confidence in individuals and legal entities creating a positive cycle in developed and developing economies, in a social way it creates job opportunities and therefore companies assure their employees who they consider the insurance as one more right.
Answering the question, the answer is affirmative. There is evidence in financial studies that highlight the relationship between economic growth and the contribution of these insurance companies, likewise, developed countries present more implementation of these insurance institutions including in their laws, although they are considered voluntary, it is highlighted that insurers create a positive aspect in the country.
