Factors Influencing Vehicle Owners’ Intentions to Extend Special Perils Coverage in Motor Insurance

Abstract

The rising frequency and severity of natural disasters have intensified the need for comprehensive motor insurance, particularly focusing on special perils coverage. This coverage plays a vital role in safeguarding vehicle owners against financial losses resulting from environmental hazards such as floods, landslides, and other catastrophic events. This study investigates the factors that influence vehicle owners' intentions to extend special perils coverage within their motor insurance policies in Klang Valley, Malaysia. A quantitative and descriptive research approach was adopted, employing convenience sampling techniques, with data analyzed using descriptive statistics through the Statistical Package for Social Sciences (SPSS) to extract valuable insights. A structured survey involving 100 vehicle owners examines the impact of knowledge, promotional efforts, and perceived benefits on their decisions to opt for extended special perils coverage. The findings highlight that these three factors - knowledge, promotion, and benefits - significantly influence the decision-making process. The study's insights are valuable for insurance companies, policymakers, and educational institutions in crafting strategies to encourage the wider adoption of special perils coverage. By increasing awareness, enhancing promotional efforts, and communicating the benefits of such coverage, stakeholders can better meet the needs of vehicle owners and boost the uptake of comprehensive motor insurance. This study underscores the importance of a multifaceted approach in promoting insurance products that offer essential protection against escalating environmental risks.