Insurance penetration is measured as

Insurance penetration is measured as

[amp_mcq option1=”the ratio of insurance premium to population” option2=”the percentage of insurance premium to GDP” option3=”the percentage of insurance premium to per capita income” option4=”the ratio of insurance premium to market capitalization” correct=”option2″]

This question was previously asked in
UPSC CBI DSP LDCE – 2023
The correct answer is B.
– Insurance penetration is a measure of the level of development of the insurance sector in a country.
– It is calculated as the ratio of total insurance premium underwritten in a given year to the Gross Domestic Product (GDP) of the country in the same year, expressed as a percentage. This indicates how much of the country’s economic output is spent on insurance premiums.
Another related measure is “insurance density,” which is calculated as the ratio of total insurance premium underwritten in a given year to the total population, indicating the average spending on insurance per person.