The determinants of non-life insurance spending: Evidence from Arab economies

Non-life insurance has grown in developing countries over the past decade, despite challenges and large differences in premiums across Arab countries. This study investigates the effect of cultural factors on non-life insurance spending in Arab countries using panel data covering the period from 2010 to 2023. Eight independent variables were employed. They are uncertainty avoidance, individualism, power distance, masculinity, long-term orientation, indulgence, income per capita and interest rate. The results of the study prove that uncertainty avoidance positively influences spending on non-life insurance. The results also show that Arab societies with pragmatic and masculine traits prefer to spend a lot of money on purchasing non-life insurance. However, the results confirm that cultural factors incorporating individualism, power distance, and indulgence negatively impact non-life insurance. Further, the interest rate also negatively affects non-life insurance. In contrast, income per capita has an insignificant impact. These results indicate that insurance companies working in Arab countries should consider those significant factors to improve the quality of insurance services that encompass non-life insurance contracts.