The Role of Insurance in Economic Growth and Development

Insurance is an important growing part of the financial sector in virtually all the developed and developing countries (Das et al., 2003). A resilient and well regulated insurance industry can significantly contribute to economic growth and efficient resource allocation through transfer of risk and mobilization of savings. In addition, it can enhance financial system efficiency by reducing transaction costs, creating liquidity and facilitating economies of scale in investment. (Bodlaetal.,2003).The present paper reviews the factors and role of insurance in economic growth and development. The present paper reviews on role of insurance in economic growth and development.