| Abstract: | The fundamental purpose of insurance, whether of people or of property, is
protection against possible economic loss, economic loss being simply defined as the
unintentional and permanent loss of something which has monetary value. Moreover,
insurance is significant part of modern economy and it is huge source of employment.
The main objective of this study is to investigate factors affecting life insurance
purchase, what factors significantly affect customers towards the purchase of life
insurance policies and to assess the factors affecting the development of life
insurance in Ethiopia. The study is made based on a primary data collected through
self-administered questionnaire from buyers who have purchased life insurance
from EIC and aged 18 years or older. To analyze the data a combination of descriptive
form of data analysis and multiple regression analysis was used. Multiple Regression
analysis was performed to investigate the effect of each explanatory variable on life
insurance demand. Accordingly except family size and gender factor, income level,
age factor, education level and health status were found to be significant
determinants of life insurance demand. Among the six determinant factors, income
level takes the highest fraction in influencing the demand for life insurance policy
followed by age factor, family size, gender, education level and health status in that
order |
