How do Life and Non-Life Insurance Affect Financial Inclusion? New Empirical Evidence from a Cross-Country Analysis

This paper examines the influence of life and non-life insurance on financial inclusion in 79 countries during 2019. Financial inclusion indices were calculated using the Euclidean distance approach. The study reveals that the financial inclusion level is considerably impacted by the integration of insurance indicators. In over 64% of the countries, the financial inclusiveness is reduced as a result of the incorporation of life insurance. In contrast, the financial inclusiveness of nearly 47% of the countries was enhanced by the inclusion of non-life insurance. The paper emphasizes the necessity for policymakers to take insurance into account as a critical element of financial inclusion strategies and measures, providing valuable insights for improving global financial inclusiveness. © 2025 Bank Indonesia Institute. All rights reserved.