ASSESSING FACTORS AFFECTING THE PERFORMANCE OF LIFE INSURANCE (A CASE STUDY IN NIB INSURANCE COMPANY)

Abstract

In Ethiopia insurance sector has contribute only 0.02021 % of the country’s GDP which is very low when we compared to other countries in the world. In Ethiopia NIB is the one of life insurance providing company with a near to the ground increase in its market share. This study therefore assesses the factors behind low development of insurance and reasons for near to the ground market share of NIB insurance company. The study employed a descriptive research design. Both Primary and secondary data was used in the study and was gathered using a questionnaire. The target population for the study was the existing employees, customers and agents/brokers and a sample of 125 respondents was chosen. The main sampling technique that was used for this study was Carvalho (1984) sampling. Based on the findings the study conclude that lack of awareness, low financial literacy, highly religiosity, saving motives and low income level of the society contribute for low development of life insurance. Whereas lack of attention of the organization to life insurance and focusing on selling non life insurance, and unattractive sales techniques have an impact for the low performance of NIB’s life insurance products. The study recommended that creating awareness on a regular basis, use aggressive marketing strategy like advertisements on different Broad casting Medias, social Medias and distributing fliers and train its employees and agents/brokers in a continuous basis so as to update and increase their knowledge possibly will hold up the improvement of life insurance sell.