ABSTRACT: This study examined the relationship between insurance penetration and economic growth in Sub-Saharan Africa (SSA) and examined the moderating role of institutional quality. Utilizing annual data from SSA countries, static models (fixed and random effects) were applied to analyze the data. Findings indicate that both life and non-life insurance penetration have a positive effect on economic growth within the region. Additionally, higher levels of institutional and governance quality were found to directly drive economic growth. Furthermore, the interaction between insurance penetration and institutional quality was shown to enhance the relationship between insurance penetration and economic growth. These results suggest that increasing insurance penetration in tandem with strengthening governance and institutional frameworks could further foster economic growth. The implications of these findings are significant for policymakers aiming to promote economic growth. Encouraging the expansion of the insurance sector and greater insurance participation, alongside reforms to improve institutional quality—such as enhancing government effectiveness, regulatory frameworks, rule of law, and corruption control—could serve as mutually reinforcing mechanisms to accelerate economic development in SSA.

KEYWORDS: Economic Growth, Insurance Penetration, Institutional Quality, Sub-Saharan Africa