Demand for Life Insurance and It’s Determinants at Household Level: Evidence from Dire Dawa City

Hailay Aregawi Hagos


The main aim of this study is to investigate the demand for life and its determining factors at household level in Dire Dawa city. For the sake of achieving this objective, primary sources of data were collected through structured questionnaire from a sample of 373 household respondents by applying a three stage multiple random sampling techniques. Moreover, data were also collected using face-to-face interview with insurance company managers and focus group discussion with some selected respondents. While descriptive narrations through concurrent triangulation strategy were applied to analyze the data collected using interview and focus group discussion, both descriptive tools and econometrics model (binary logit model) were employed to analyze the data collected using questionnaire. The result of the study revealed that the communities’ demand for and awareness on life insurance is low. Besides, the study indicated that age, educational level, income level, occupation, number of dependent family size, knowledge, awareness, institutional factors, religion and perception were found statistically significant factors that determine the communities’ willingness to purchase life insurance.

Keywords: Demand, life insurance, awareness, perception, willingness and insurance policy

DOI: 10.7176/RJFA/10-17-06

Publication date:September 30th 2019

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ISSN (Paper)2222-1697 ISSN (Online)2222-2847

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