Abstract
Several empirical articles have attempted to clarify the insurance demands of listed firms, but few have sought to analyze small and medium enterprises’ (SMEs) demands because of the unavailability of adequate data. In this study, I analyze SMEs’ insurance demand by using a corporate survey and find the following. First, SMEs with relatively weak relationships with their main banks tend to demand more insurance. Second, SMEs with higher tax incentives tend to demand more insurance. Third, SMEs with a higher probability of bankruptcy tend to demand less insurance.
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