Factors Shaping Consumers Intention in Purchasing Life Insurance Policy in Bangladesh: A Binary Logistic Analysis

Abstract

Abstract This paper investigates the demographic and socio-economic influential factors that work as a motivational tool for purchasing life insurance policies by the eligible consumers of Bangladesh. Using convenience sampling technique, responses of three hundred seventy-eight persons have been analyzed using this study's binary logistic regression model. This study found that demographic variables like age, education, and gender have no significant impact on life insurance policy buying decisions. On the contrary, the number of dependents in a family, nature of work, and monthly income positively impact the policy purchase decision. This study also reveals that insurance literacy has a positive influence, but acquired information about insurance policy negatively impacts consumers' purchasing decisions. In addition to that, the study's findings also show that people usually purchase a life insurance policy for tax benefit purposes instead of investment purposes. The outcomes of the study will be helpful to the insurers and policymakers to find out the major areas of improvement to bring more people under life insurance coverage, and for prospective consumers, it will guide them to understand the benefits of having a life insurance policy. JEL classification numbers: C83, C93, H55, I13. Keywords: Life insurance, Logistic model, Forecasting, Tax benefits, Agent.