Assessing The Role Of Insurance Companies In The Economy Of Insurance Industry

Assessing The Role Of Insurance Companies In The Economy Of Insurance Industry

Abstract

The main end of this exploration is to determine the part of insurance companies on the Frugality of Cameroon using the Cameroon insurance assiduity as case study. This purpose of the study is to know whether or not there live a part played by insurance companies on Cameroon Economy. We had to resolve our main ideal into two in order to dissect the part of both life andnon-life insurance companies on the frugality of Cameroon. This is done using secondary sources of data on the GDP of Cameroon and other pointers of insurance companies similar as the total insurance content, acceptability of social insurance, insurance and fiscal services. After the analysis, the main results showed that insurance companies play a part on the Frugality of Cameroon as portrayed with the use of the Pearson correlation. At the end, we came up with some recommendations that the government should keep on motivating the insurance companies through their programs because of the determinant part they play in the frugality and that insurance companies on their own part should try to increase the mindfulness of their products and services to the public.

Chapter One

Preface

Background of the study

A lot of debate can be emphasized on the part played by insurance companies in the world but simplicity entitles us to concentrate on the frugality of Cameroon. Whether insurance or assurance throughout the periods, there has always been a need for insurance. The need for insurance arises from fear of the unknown, fear of threat and fear of loss( Webster wordbook, 1997). People want to be ensured against the unknown and factors for which they’ve little control. still, insurance as we know it didn’t spring up but has evolved over centuries grounded on changes in need, regulation, and technology( Buckham & etal, 2010).

The foremost known insurance instrument dates back to the sumptuous period of Circa 2250 BC( Buckham & etal, 2010). When the Babylonians developed a type of loan insurance for marine business. Upon damage of loan to fund a payload, a trafficker would generally pay the lender an fresh decoration in exchange for the lenders guarantee to conceal the loan should the payload be stolen or lost at ocean. Then, the lender assumed the pitfall of the good in conveyance at a decoration rate of interest. These marine loans persisted until the thirteenth century in the Italian megacity countries of Genoa and Venice.( Buckham & Etal, 2010).

vessels and weight were constantly in peril of being seized by rovers while both fiscal andnon-financial threat diversification where developed in the form of common stock gambles, pooling of goods of a number of trafficker to be vended concertedly.( Buckham & etal, 2010). The trafficker didn’t formalize the conception of chances in the statistical sense; they reckoned on suspicion, private experience and objective record to guide the estimation rather than on the former probabilistic logic grounded on actuarial substantiation. Pascal triangle led to the first actuary tables that are still used in calculating insurance rates( Beattie, 2016).

Life and health insurance had it significance in 1840 when the artificial revolution created need for security that had traditionally given to a nation of growers. Health insurance started as accident insurance in 1950 with the first bus insurance in 1898( Dictionary of America, 2003). In terms of practice, insurance companies are divided into two videlicet life andnon-life insurance companies. Life insurance include whole life( death), term and talent, health whilenon-life insurance include liability loss, workers compensation and property loss( Messomo, 2015). moment, Cameroon counts about 25 insurance companies( Minepat, 2012). Insurance companies have been described as the business that exists in order to insure the survival of other business( Muhammed, 1998). Insurance companies are of vital significance in an frugality.

An frugality is what people produce and the relationship that make that product possible( Ian welsh, 2013). Others define an frugality as the process or system by which goods and service are produced, vended and bought in a country or region( Merriam Webster, 1828). The frugality of Cameroon like any other frugality in the world suffered some profitable extremity in 1986 as a result of changing transnational profitable and domestic policy terrain( Derrick, 1992) which formerly boomed in the medial 1970 with a 7 growth rate and a per capita income of$ 800( Wilfred & Mufor, 2011). Which saw the collapse of some banks in Cameroon similar as the Cameroon bank, Meridian BIAO and BICIC.

Molua, 2010) noted that Cameroon endured a smash in its renewable and total natural coffers exploitation from the medial 1970 to the end of the 1980. The frugality of Cameroon has gone through three decades.

This comprises the period of real profitable growth particularly in the time 1960 to 1986. The period of profitable extremity that stem up in the period of 1986 to 1994 and the period of profitable recovery that started from 1995 to date which is a period appertained to as globalization. Cameroon responded to this extremity by reducing public expenditure( Baye et al, 2002).

Statement of the problem

Insurance companies in an frugality serve as fiscal interposers. By their nature, they bear threat and these pitfalls incompletely depend on the insurer’s capability to anticipate the frequence magnitude of the threat they promise to cover. They transfer coffers from those who would save to those who’ll invest( Richard et al, 1990). In fact, without an insurance assiduity, the frugality would virtually come to a deadlock( McGrath, 1990). From this assertion of( McGrath, 1990), also this main question What’s the part played by insurance companies in an frugality?

From the below, we can induce the following specific questions as follows

• What’s the part of life insurance companies in Cameroon frugality?

• What’s the part ofnon-life insurance companies in Cameroon frugality?

exploration objects

The main ideal of this study is to examine the part played by insurance companies in Cameroon frugality. With specific objects as;

• relating the part of life insurance companies in Cameroon frugality.

• assaying the part ofnon-life insurance companies in Cameroon frugality.

• Making Recommendations.

Working suppositions

We’re going to use the following working suppositions

H1 Life insurance companies play a part in Cameroon frugality.

H2Non-life insurance companies play a part in Cameroon frugality.

Significance of the Study

This study is of early significance to the colorful parties which include; the pupil, associations and the government. With respect to the pupil, it’s important because it’ll prop them to identify loopholes in an association or an frugality. Next, it’ll inversely serve as a standard for unborn experimenters who’ll image diving this problematic. Incipiently, it’s a university demand as partial fulfillment in order to enroll for a bachelorette’s degree.

As far as an association is concerned, it’ll help the association to identify its crucial position in an frugality or the part it plays in profitable development. If well understood it entitles companies to readdress their programs or the services they offer so that it suits the need of the frugality because it’s worth noting its services directly affects the public or its guests and the frugality as a globe. Again, it inversely helps the association to understand the changing terrain.

Last but not the least, the study is inversely important to the government as it’ll guide them on their policy perpetration by relating the crucial places of insurance companies will induce useful information which will be used to prognosticate the future. It’ll inversely be helpful for them to compare the business with other businesses in the same sector.

Compass and Delimitation

This study attempts to demonstrate the part played by life andnon-life insurance companies in an frugality and covers a one time academic that’s academic time 2015- 2016. The case study in visage to explain this miracle is the Cameroon insurance assiduity. The major difficulty in this study is to get dependable information concerning the subject matter under disquisition.

Plan of the Study

This study is segmented into five chapters as organized below;

Chapter one is the introductory chapter which is divided into seven and where we’ve the background information, the problem statement, the exploration objects, and exploration suppositions, significance of the study, compass and limitation and incipiently the plan of the study. Chapter two is literature review which contains parts similar as abstract issues, related propositions, empirical literature and theoretical frame while chapter three is the methodology.

In chapter four, we present the results of the data anatomized and interpret the results which is again to chapter five where we make a summary of the study, draw conclusions and give our recommendations.