Determinants Affecting Life Insurance Purchase Decision at Jhapa District

Abstract

This paper aims to investigate the effect of determining factors like Customer Attitude, Insurance Awareness, Financial Literacy and Social Factor on purchase decision of life insurance policy in Jhapa district of Nepal. Primary data have been collected through structured questionnaire using online method i.e. Google Forms out of 384 life insurance policy holders resident of Jhapa district of Nepal. A descriptive Research and causal comparative design was used and sample was selected by purposive sampling method. Smart PLS 4 is used as a data analysis tool and various tests like descriptive analysis, Measurement Model Assessment, Convergent Validity and Discriminant Validity, Model Fit Assessment, Structural Model Assessment and Importance-Performance Map Analysis (IMPA) tests were conducted as analysis tool to assess the quantitative raw data. The study concludes that Customer Attitude, Financial Literacy, and Insurance Awareness has significant effect with the purchase decision of life insurance policy whereas Social Factor has no significant effect with the purchase decision of life insurance policy. Financial Literacy has the highest influence over purchase decision of life insurance. Thus, the marketers, policymakers and insurance companies must pay more attention in bringing more effective and fruitful programs to enhance the life insurance demand.