The Impact of Attention to Financial Information on Households' Commercial Endowment Insurance Purchase Decisions — Based on CHFS Data

Abstract

In the context of China's increasingly aging population, commercial endowment insurance has become an important support for multi-level endowment security system, but its family participation rate has been low for a long time.Based on the mixed cross-section data of CHFS from 2015 to 2019, this paper adopts two-way fixed effect model to systematically examine the impact of financial literacy represented by attention to financial information  on whether households purchase commercial endowment insurance. The empirical results show that attention to financial information significantly improves the probability of household insurance participation, and it is still robust after controlling the characteristics of household head, household economic status and two-way fixed effects. After multiple robustness tests such as shrinking the sample, replacing the fixed effect and changing the estimation model, the conclusions remain unchanged. Heterogeneity results show that the positive effect is more significant in rural and eastern regions, but relatively limited in urban and central and western regions. Risk preference is a significantly positive moderating effect on the insurance participation decision. The mechanism analysis further reveals that attention to financial information promotes households to make insurance participation decisions by improving financial knowledge level and risk identification ability. Therefore, the article suggests building the differentiated financial education system, strengthening the construction of financial infrastructure, and improving the institutional environment to enhance residents' long-term confidence in participation.