Drivers of life insurance consumption - an empirical analysis of Western Balkan countries

Life insurance in the Western Balkan Countries is underdeveloped, but it has huge potential for development in the future. The scope of this article is to examine whether and how economic, socio- demographic, and institutional factors determine the demand for life insurance in the Western Balkans, using life insurance density and life insurance penetration as indicators of life insurance demand during 2006-2019. In order to conduct a crosscountry analysis we use panel data regression models and a feasible generalised least squares regression model. The analysis reveals that the most significant factors are income per capita and changes in the urban population. The article contributes to the existing literature by identifying the variables that affect demand for life insurance in the Western Balkans and by providing evidence for insurance operators, authorities, and governments of the respective countries to find ways to further develop the insurance market.