What is the role of environmental pollution in commercial health insurance? Evidence from quasi-natural experiments of low-carbon city policy in China

This paper investigates the low-carbon city policy on urban environmental pollution and commercial health insurance (CHI) by PSM-DID and DDD methods. The study finds that (1) low-carbon city policy reduces CHI significantly. (2) The mechanism analysis shows that the low-carbon city policy reduces CHI by mitigating environmental pollution in the pilot cities. Further analysis finds that the policy is effective in Tier 1 and 2 cities rather than Tier 3–5 cities. (3) In the heterogeneity analysis, this paper finds that this policy has the most significant disincentive effect on urban CHI density in cities with higher CHI and more serious environmental pollution. This paper, on the one hand, expands upon the extant research on the economic implications of low-carbon urban development from the perspective of environmental pollution, and on the other, furnishes novel evidence on how policy incentives shape the demand for insurance products in response to environmental changes.