Financial Development and Human Capital: The Effect of Insurance Sector Expansion in Enhancing Adult Lifespan in Cameroon (1977-2023)

Abstract

This study investigates the effect of the growth of Cameroon's insurance financial services sector development on adult longevity, measured by survival rates to age 65 for males and females over the period, 1977–2023 utilizing time-series data from the World Bank's World Development Indicators. The analysis employs an Autoregressive Distributed Lag (ARDL) bounds testing approach to examine long-run and short-run relationships, supplemented by Granger causality tests and forecasting. Descriptive statistics reveal increasing longevity trends amid fluctuating insurance sector indicators, with imports exceeding exports. The ARDL model confirms cointegration, showing positive long-run effects of insurance exports on longevity (for instance, a 1% increase in commercial service exports boosts survival by 0.15%) and negative effects from imports. Short-run dynamics mirror this pattern, with a 59% annual adjustment speed to equilibrium. However, Granger causality indicates no directional influence from insurance growth to longevity, suggesting concurrent or reverse dynamics. Forecasts project continued longevity gains to 70% by 2028. These findings highlight a "human dividend" from export-oriented insurance development, filling a gap in Cameroonian literature and informing policies for health-related Sustainable Development Goals.

Keywords:       Adult Lifespan, Human Capital, Financial Development, Insurance Sector Expansion.