CHAPTER 1

INTRODUCTION

CONSUMER BEHAVIOR:

Consumer behavior is the study of how individual customers, groups or organizations select,
buy, use, and dispose ideas, goods, and services to satisfy their needs and wants. It refers to
the actions of the consumers in the marketplace and the underlying motives for those actions.
Marketers expect that by understanding what causes the consumers to buy particular goods
and services, they will be able to determine—which products are needed in the marketplace,
which are obsolete, and how best to present the goods to the consumers. The study of
consumer behavior assumes that the consumers are actors in the marketplace. The perspective
of role theory assumes that consumers play various roles in the marketplace. Starting from
the information provider, from the user to the payer and to the disposer, consumers play these
roles in the decision process. The roles also vary in different consumption situations; for
example, a mother plays the role of an influencer in a child’s purchase process, whereas she
plays the role of a disposer for the products consumed by the family.

CONSUMER BUYING BEHAVIOR:

Consumer Buying Behavior refers to the actions taken (both on and offline) by consumers
before buying a product or service. This process may include consulting search engines,
engaging with social media posts, or a variety of other actions. It is valuable for businesses to
understand this process because it helps them better tailor their marketing initiatives to the
marketing efforts that have successfully influenced consumers to buy in the past.

IMPORTANCE OF CONSUMER BUYING BEHAVIOR:

Consumer buying behavior is significant to businesses and marketers as it directly influences

their strategies, product development, marketing efforts, and overall success. Understanding
consumer buying behavior helps businesses in the following ways:

1. Product Development: By understanding consumer preferences, needs, and

motivations, businesses can develop products and services that are more aligned with
what consumers are looking for. This can lead to higher satisfaction and increased
sales.
2. Marketing Strategies: Knowledge of consumer buying behavior allows businesses to
tailor their marketing strategies to effectively reach their target audience. It helps in

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 creating targeted advertising, messaging, and promotions that resonate with
consumers, leading to higher engagement and conversion rates.

3. Customer Segmentation: Understanding consumer behavior enables businesses to

segment their customer base effectively. By identifying different consumer groups
with varying needs, preferences, and buying patterns, businesses can create more
relevant and personalized marketing campaigns.
4. Customer Experience: Insights into consumer behavior help businesses improve the
overall customer experience. By understanding how consumers make purchasing
decisions, companies can enhance their service, support, and engagement to better
meet consumer expectations.
5. Competitive Advantage: Businesses that deeply understand consumer buying
behavior can gain a competitive edge. They can anticipate market trends, identify
emerging needs, and adapt their strategies more effectively than competitors.
6. Brand Loyalty and Retention: Consumer buying behavior insights are essential for
building and maintaining brand loyalty. By understanding what influences consumer
loyalty, businesses can create loyalty programs, improve customer service, and foster
long-term relationships with their customers.
7. Risk Mitigation: Understanding consumer behavior can help businesses anticipate
market shifts, changing trends, and potential risks. This allows them to adjust their
strategies and offerings proactively.

Consumer buying behavior is crucial for businesses to remain relevant, competitive, and
successful in the marketplace. It helps them align their offerings with consumer needs, build
strong customer relationships, and adapt to the ever-changing market dynamics.

FACTORS AFFECTING CONSUMER BUYING BEHAVIOUR:

1. Cultural Factors - Culture is not always defined by a person's nationality. It can also
be defined by their associations, their religious beliefs or even their location.
Consumer buying behavior is deeply nuanced by cultural factors, such as buyer’s
culture, subculture, and social class.
 Culture - Culture is the share of each company and is the major cause of the person's
wants and behavior. The influence of culture on purchasing behavior varies from
country to country, therefore sellers must be incredibly careful in the analysis of the
culture of diverse groups, regions or even countries.
 Subculture - Each culture has different subcultures, such as religions, nationalities,
geographical regions, racial, etc.
 marketing groups may use these groups, segmenting the market in several small
portions. For example, Marketers can design products according to the needs of a
specific geographical group.

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 Social Class - Every society has some kind of social class is important for marketing
because the buying behavior of People in a particular social class are similar. Thus,
marketing activities could be adapted to different social classes. Here we should note
that social class is not only determined by income, but there are several other factors
such as wealth, education, occupation etc.

2. Social Factors - Elements in a person's environment that impact the way they see
products.
 Reference Groups: Reference groups have the potential for the formation of an
attitude or behavior of the individual. The impact of reference groups varies across
products and brands. For example, if the product is visible as clothing, shoes, car etc.,
the influence of reference groups will be high. Reference groups also include opinion
leaders (a person who influences others by his special skill, knowledge, or other
characteristics).
 Family: Buyer behavior is strongly influenced by a family member. So, vendors are
trying to find the roles and influence of the husband, wife, and children. If the
decision to purchase a particular product is influenced by the wife of then sellers will
try to target women in their ad. Here we should note that the purchase of roles
changes with changing lifestyles of consumers.
 Roles and Status - Each person has distinct roles and status in society in terms of
groups, clubs, family, etc. organization to which it belongs to. For example, a woman
working in an organization as manager of {nance. Now she is playing two roles, one
of the chief financial officers and the mother. Therefore, purchasing decisions will be
influenced by their role and status.

3. Personal Factors - Personal factors may also affect consumer behavior. Some of the
crucial factors that influence personal buying behavior are lifestyle, economic status,
occupation, age, personality, and self-esteem.
 Age - Age and life cycle have a potential impact on the purchasing behavior of
consumers. It is obvious that consumers change the purchase of goods and services
over time. The family life cycle consists of different stages as young singles, married
couples, unmarried couples etc. that help marketers to develop suitable products for
each stage.
 Occupation - The occupation of a person has a significant impact on their buying
behavior. For example, a marketing manager of an organization is trying to buy
business suits, while a low-level worker in the same organization buys-resistant
clothing work.
 Economic status - Economic situation of the consumer has a major influence on their
buying behavior. If the income and savings of a customer is high, then they are going
to buy more expensive products. Moreover, a person with low income and savings
buys cheap products.

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  Personality - Personality changes from person to person, time to time and place to
place. Therefore, it can influence the buying behavior of customers. In fact,
personality is not what one has, but is the totality of the conduct of a man in different
circumstances. It has distinctive characteristics, such as dominance, aggression,
confidence etc. that may be useful to determine the behavior of consumers to the
product or service.
 Lifestyle - Lifestyle clients is another factor acting import purchasing behavior of
consumers. Lifestyle refers to the way a person lives in a society and expresses things
in their environment. It is determined by the client’s interests, opinions, etc. and
activities shape their whole pattern of acting and interacting in the world.

4. Psychological Factors - A person's state of mind when they are approached with a
product will often determine how they feel not only about the item itself but the
brand.
 Motivation - The level of motivation also affects the purchasing behavior of
customers. Each person has unique needs, such as physiological needs, biological
needs, social needs, etc. The nature of the requirements is that some are more urgent,
while others are less pressing. Therefore, a need becomes a motive when it is most
urgent to lead the individual to seek satisfaction.
 Perception - Select, organize, and interpret information in a way to produce a
meaningful experience of the world is called perception. There are three different
perceptual processes which are selective attention, selective distortion, and selective
retention. In the case of selective attention, sellers try to attract the attention of the
customer. Whereas in case of selective distortion, customers try to interpret the
information in a way that supports what customers already believe. Similarly, in the
case of selective retention, marketers try to retain information that supports their
beliefs.
 Beliefs and Attitudes - Client has specific beliefs and attitudes towards different
products. Because such beliefs and attitudes shape the brand image and affect
consumer buying behavior, traders are interested in them.

WHAT ARE DEMOGRAPHIC FACTORS?

Demographic factors refer to characteristics of a population segment that are typically

quantifiable and include attributes such as age, gender, income, education level, occupation,
family size and life cycle, marital status, geographic location, ethnicity, religion, and
nationality. These factors provide insights into the composition and diversity of a population
and are commonly used in market research, social sciences, and marketing to understand and
analyze consumer behavior, voting patterns, employment trends, and other social phenomena.
Demographic factors help businesses and policymakers make informed decisions by
identifying target markets, tailoring products and services, and designing effective policies
and programs.

These factors include variables such as:

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 1. Age: Different age groups have different needs, preferences, and buying habits.
2. Gender: Gender can influence preferences in certain types of products or services.
3. Income Level: Income level determines the purchasing power of the consumer.
4. Race and Ethnicity: Different races and ethnicities may have different cultural
practices that can influence consumer behavior.
5. Marital Status: The needs and buying behavior of married individuals can be
different from those who are single.
6. Educational Achievement: Education level can affect consumer preferences and the
type of products or services they value.
7. Employment Status: Whether a person is employed, unemployed, or retired can
significantly impact their buying behavior.
8. Geographic Location: Geographic location can influence consumer preferences and
needs.
9. Homeownership: Homeowners might have different needs compared to those who
rent.

These demographic factors are often used in market research to help businesses understand
their target audience, tailor their offerings, and plan their marketing strategies.

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WHAT IS LIFE INSURANCE?

Life is full of uncertainties and misfortunes, mostly come unannounced. Certain events can
have an irreversible impact on one’s life and leave one’s loved ones bereaved. To lessen the
financial burden on those loved ones in his absence, taking a suitable life insurance policy is
highly recommended. At the same time, life insurance is a crucial form of investment that
will help their family to meet their essential needs even when the main earner of their family
is not around. At the time of Claim Dispersal of Life Insurance Policy, the sum assured is
passed on to the beneficiary or nominee on the death of the policy holder. In addition, some
life insurance policies offer investment benefits on maturity of the policy tenure and hence
we can say the policy benefits are two-fold.

DEFINITIONS:

“Life insurance is a contract between a life insurance company and a policy owner. A life
insurance policy guarantees the insurer pays a sum of money to one or more named
beneficiaries when the insured person dies in exchange for premiums paid by the
policyholder during their lifetime.”

KEY POINTS ABOUT LIFE INSURANCE:

1. Life insurance is a legally binding contract that pays a death benefit to the policy
owner when the insured person dies.
2. For a life insurance policy to remain in force, the policyholder must pay a single
premium upfront or pay regular premiums over time.
3. When the insured person dies, the policy’s named beneficiaries will receive the
policy’s face value, or death benefit.
4. Term life insurance policies expire after a certain number of years. Permanent life
insurance policies remain active until the insured dies, stops paying premiums, or
surrenders the policy.
5. A life insurance policy is only as good as the financial strength of the life insurance
company that issues it. State guaranty funds may pay claims if the issuer cannot.

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COMPONENTS OF LIFE INSURANCE:

Life insurance typically consists of several components that work together to provide
financial protection to the policyholder and their beneficiaries. These components can vary
based on the specific type of life insurance policy, but some common elements include:
1. Death Benefit: This is the core component of a life insurance policy. The death
benefit is the amount of money that is paid out to the policyholder's beneficiaries
upon the insured person's death. It provides financial security to the insured's loved
ones.
2. Premiums: Policyholders are required to pay regular premiums to keep the life
insurance policy active. The premium amount is determined based on factors such as
the insured person's age, health, and the coverage amount.
3. Policy Term or Duration: Life insurance policies can have different terms or
durations. For example, term life insurance provides coverage for a specific period,
while permanent life insurance (such as whole life or universal life) offers coverage
for the insured's entire life.
4. Cash Value (for Permanent Life Insurance): Permanent life insurance policies
often include a cash value component. A portion of the premium payments goes into a
cash value account, which accumulates on a tax-deferred basis. Policyholders can
potentially access this cash value through policy loans or withdrawals.
5. Riders: These are additional features that can be added to a life insurance policy to
customize its coverage. Common riders include accidental death benefit riders, waiver
of premium riders, and accelerated death benefit riders.
6. Underwriting: Life insurance companies assess the risk of insuring an individual
through a process called underwriting. This involves evaluating the applicant's health,
lifestyle, and other factors to determine the appropriate premium and coverage.
7. Beneficiary Designation: Policyholders designate one or more beneficiaries who will
receive the death benefit upon the insured person's passing. Beneficiaries can be
individuals, trusts, or organizations.
These components collectively form the structure of a life insurance policy, providing
financial protection and peace of mind to the policyholder and their loved ones.

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TYPES OF LIFE INSURANCE:

1. Term insurance plan: As the name says Term insurance plan are those plan that is
purchased for a fixed period, say 10, 20 or 30 years. As these policies do not carry any
cash value their policies do not carry any maturity benefits, hence their policies are
cheaper as compared to other policies. This policy turns beneficial only on the
occurrence of the event.
2. Endowment policy: The only difference between the term insurance plan and the
endowment policy is that endowment policy comes with the extra benefit that the
policyholder will receive a lump sum amount in case he survives until the date of
maturity. The rest of the details of term policy are the same and applicable to an
endowment policy.
3. Unit Linked Insurance Plan: These plans offer policyholders the chance to build
wealth in addition to life security. Premiums paid into this policy are bifurcated into
two parts, one for the purpose of Life insurance and another for the purpose of
building wealth. This plan offers to partially withdraw the amount.
4. Money Back Policy: This policy is like an endowment policy; the only difference is
that this policy provides many survival benefits which are allotted proportionately
over the period of the policy term.
5. Whole Life Policy: Unlike other policies which expire at the end of a specified
period, this policy extends up to the whole life of the insured. This policy also
provides survival benefits to the insured. In this type of policy, the policyholder has
an option to partially withdraw the sum insured. Policyholders also have the option to
borrow sum against the policy.
6. Annuity/Pension Plan: Under this policy, the amount collected in the form of a
premium is accumulated as assets and distributed to the policyholder in the form of
income by way of annuity or lump sum depending on the instruction of insured.

WHY IS LIFE INSURANCE IMPORTANT:

Despite being life’s most permanent reality, death continues to be a difficult conversation in
India. Likewise, despite being a crucial aspect of life, life insurance is not something that
people like to consider buying. No one wants to think of a situation which involves either of
these. However, if the idea of passing on your financial liabilities to your dependents scares
you, life insurance should be your utmost priority.

As per the Economic Survey 2021-2022, the Covid-19 pandemic pushed the life insurance
penetration in India close to the global average, rising from 2.82% in 2019 to 3.2% in 2020.
Though an improvement from previous years, this signifies the sizable population that still
needs to be covered. Here’s why life insurance is so important.

LIFE INSURANCE IN INDIA:

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Life insurance is one of the growing sectors in India since 2000 as Government allowed
Private players and FDI up to 26% and recently Cabinet approved a proposal to increase it to
49%. In 1955, mean risk per policy of Indian and foreign life insurers amounted respectively
to ₹2,950 & ₹7,859(worth ₹15 lakh & ₹41 lakh in 2017 prices). Life Insurance in India was
nationalized by incorporating Life Insurance Corporation (LIC) in 1956. All private life
insurance companies at that time were taken over by LIC. In 1993, the Government of India
appointed RN Malhotra Committee to lay down a road map for privatization of the life
insurance sector.

GROWTH OF LIFE INSURANCE IN INDIA:

the life insurance sector in India had been experiencing significant growth. Several factors
contributed to this expansion:

1. Increasing Awareness: There was a growing awareness among Indian consumers

about the importance of life insurance. People were becoming more conscious about
securing their and their family's financial future.
2. Economic Growth: India had been experiencing steady economic growth, leading to
a rise in disposable incomes. As people's incomes increased, they were more inclined
to invest in life insurance policies as a means of long-term financial planning.
3. Government Initiatives: The Indian government had been introducing various
initiatives to promote insurance penetration in the country. These initiatives included
increasing the insurance sector's reach to rural areas, promoting insurance products
through various schemes, and incentivizing insurance companies to develop
innovative and affordable products.
4. Product Innovation: Insurance companies were introducing innovative products
tailored to the diverse needs of customers. These products offered a combination of
protection, savings, and investment features, attracting a wider customer base.
5. Distribution Channels: Insurance companies were expanding their distribution
networks, reaching out to more customers through various channels such as agents,
bancassurance (selling insurance through banks), and digital platforms. The
penetration of internet services and smartphones also facilitated the growth of online
insurance sales.
6. Regulatory Support: The regulatory environment in India, overseen by the Insurance
Regulatory and Development Authority of India (IRDAI), provided a conducive
framework for the growth of the insurance sector. Regulations focused on consumer
protection, product innovation, and market stability.

GROWTH OF LIFE INSURANCE POST COVID-19:

The impact of COVID-19 on the Indian life insurance industry has been multifaceted, leading
to both challenges and opportunities for growth. Here is a breakdown of the key aspects:

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Initial Hit:

Short-term dip: Like many sectors, the life insurance industry witnessed a decline in
premium collection and new policy sales during the initial lockdown phase due to economic
uncertainty.

Rebound and Growth:

Increased awareness: The pandemic highlighted the importance of financial security and
risk protection, leading to a surge in demand for life insurance, particularly term plans
offering affordable coverage.

Digital adoption: The pandemic accelerated the shift towards online insurance purchases,
making it easier and more convenient for people to buy policies.

Product innovation: Insurers launched new products catering to specific needs, like
COVID-specific riders and critical illness covers, further attracting customers.

Challenges:

Higher claims: Increased mortality rates during the pandemic resulted in higher claim
payouts for insurers, impacting profitability.

Reinsurer concerns: Global reinsurers became hesitant to take on additional risk from India
due to higher mortality, putting pressure on domestic insurers.

Underinsurance: Despite the growth, insurance penetration and density in India remain low,
indicating a sizable untapped market potential.

Overall:

Positive growth: The life insurance industry in India has seen positive growth since the
initial COVID-19 impact, with premiums and new business premiums registering double-
digit growth in recent years.

Emerging trends:

Growing focus on term plans and protection-oriented products.

Increasing digital adoption for policy purchase and servicing.

Focus on financial literacy to improve insurance penetration.

The life insurance sector in India is expected to experience robust growth in the next five
years (2024-2028), with premiums forecast to increase by 6.7% during this period. This
growth is supported by rising demand for term life cover by the middle-class and the
country's young, as well as increasing industry adoption of Insurtech. The COVID-19
pandemic has led to significant changes in the life insurance industry in India, including a
shift towards digital processes and an increase in demand for term insurance. While the
pandemic has affected premium collections, its impact on the downfall of premium collection

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in the life insurance sector is less significant. Post the pandemic, reinsurance companies in
India are tightening underwriting practices, revisiting non-medical limits, and increasing term
insurance rates. A paper discussed the performance of life insurance companies during
COVID-19 and the growth of the life insurance sector during the pandemic.

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LIFE INSURANCE COMPANIES IN INDIA:

1. Life Insurance Corporation of India (LIC).

2. Max Life Insurance Company Limited.
3. ICICI Prudential Life Insurance Company Limited.
4. Kotak Mahindra Life Insurance Company Limited.
5. Aditya Birla Sunlite Insurance Company Limited.
6. Bajaj Alliance Life Insurance Company Limited.
7. Tata Aia Life Insurance Company Limited.
8. SBI Life Insurance Company Limited.
9. Bajaj Allianz Life Insurance Company Limited.
10. MetLife India Insurance Company Limited.
11. Reliance Nippon Life Insurance Company Limited.
12. Aviva Life Insurance Company Limited.
13. Sahara India Life Insurance Company Limited.
14. Shriram Life Insurance Company Limited.
15. Bharti AXA Life Insurance Company Limited.
16. Future Generali India Life Insurance Company Limited.
17. Ageas Federal Life Insurance Company Limited.
18. Canara HSBC Life Insurance Company Limited.
19. Aegon Life Insurance Company Limited.
20. Pramerica Life Insurance Company Limited.
21. Union Dai-ichi Life Insurance Company Limited.
22. India First Life Insurance Company Limited.
23. Edelweiss Tokio Life Insurance Company Limited.
24. Exide Life Insurance Company Has Merged with HDFC Life Insurance Company
Effective from The End of Day 14th October 2022

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RELATION BETWEEN CONSUMER BUYING BEHAVIOR AND LIFE
INSURANCE:

The relationship between consumer buying behavior and life insurance is complex and
influenced by numerous factors. Here is a breakdown of some key aspects:

Motivations for Buying Life Insurance:

 Risk Aversion: The primary motivator is often risking aversion. Consumers seek
financial protection for dependents in case of their sudden death.
 Financial Security: Life insurance can provide a lump sum payout or income stream,
securing the financial future of loved ones.
 Investment and Savings: Certain policies offer investment components, combining
protection with wealth creation.
 Tax Benefits: Life insurance premiums often provide tax deductions, making them
attractive for some.

Factors Influencing Buying Behavior:

 Demographics: Age, income, marital status, and presence of dependents significantly

impact needs and purchase decisions.
 Financial Literacy: Understanding financial concepts and risk management
influences insurance perception and product selection.
 Risk Perception: Individual risk tolerance and awareness of mortality risk affect the
willingness to buy, and policy type chosen.
 Marketing and Sales: Insurance companies' marketing strategies, product offerings,
and agent interactions influence perception and buying decisions.
 Social Influence: Family, friends, and societal norms can shape attitudes towards
insurance and encourage or discourage purchase.

Behavioral Biases in Buying:

 Loss Aversion: People fear losses more than they value gains, leading to a preference
for coverage against negative outcomes.
 Present Bias: Immediate concerns often outweigh future planning, influencing
decisions about long-term protection like life insurance.
 Overconfidence: Individuals might underestimate their mortality risk, delaying or
avoiding life insurance purchase.

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ROLE OF CONSUMER BUYING BEHAVIOR PLAYS IN LIFE INSURANCE

Consumer buying behavior plays a significant role in the life insurance industry. Here is how:

1. Need Recognition: Consumer buying behavior starts with the recognition of a need.
Life insurance is typically purchased to provide financial protection to loved ones in
case of the policyholder's death. Factors such as age, marital status, dependents, and
financial obligations influence the recognition of this need.
2. Information Search: Consumers conduct research to gather information about
different life insurance products, coverage options, premiums, and benefits. They may
seek information from various sources such as insurance agents, online reviews,
company websites, and recommendations from friends and family.
3. Evaluation of Alternatives: Consumers evaluate different life insurance options
based on factors such as coverage amount, premium affordability, policy terms,
reputation of the insurance company, and customer service. They compare different
policies to find the one that best fits their needs and budget.
4. Purchase Decision: Once consumers have gathered sufficient information and
evaluated their options, they make a purchase decision. Factors influencing this
decision include the perceived value of the policy, trust in the insurance provider,
affordability, and the perceived financial security it offers to their beneficiaries.
5. Post-Purchase Behavior: After purchasing a life insurance policy, consumers may
experience post-purchase behavior such as satisfaction or dissatisfaction with the
policy and the insurance company. Their experience with the claims process,
customer service, and any interactions with the insurer can influence their overall
satisfaction and likelihood of recommending the insurer to others.
6. Word of Mouth and Referrals: Positive experiences with life insurance can lead to
word-of-mouth recommendations and referrals to friends, family, and colleagues.
Conversely, negative experiences can lead to complaints and deter others from
purchasing insurance from the same provider.
7. Loyalty and Renewals: Consumer buying behavior also influences loyalty and
renewal rates in the life insurance industry. Satisfied customers are more likely to
renew their policies with the same insurer and may even purchase additional coverage
over time. Building long-term relationships with customers through personalized
service and ongoing communication is crucial for insurers to retain customers and
encourage renewals.

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DEMOGRAPHIC FACTORS AFFECTING CONSUMER BUYING BEHAVIOR IN
LIFE INSURANCE:

Several demographic factors can influence consumer buying behavior when it comes to
purchasing life insurance. These factors include:

1. Age: Different age groups have varying needs and priorities when it comes to life
insurance. Younger individuals may prioritize affordability and coverage for
dependents, while older individuals may focus on retirement planning and legacy
protection.
2. Marital Status: Married individuals may consider life insurance to protect their
spouse and children financially in the event of their death. Single individuals may also
purchase life insurance for income replacement or to cover final expenses.
3. Family Size: The number of dependents a person has can significantly impact their
life insurance needs. Individuals with larger families may require higher coverage
amounts to ensure financial stability for their loved ones.
4. Income Level: Higher-income individuals may opt for more comprehensive life
insurance policies to maintain their standard of living for their beneficiaries. Lower-
income individuals may prioritize affordability and may opt for basic coverage to
cover essential expenses.
5. Occupation: The nature of one's occupation can influence the need for life insurance.
Individuals in high-risk professions may seek higher coverage amounts to provide
financial security for their families in case of accidents or fatalities.
6. Education Level: Education can influence consumers' understanding of life insurance
products and their ability to make informed decisions. More educated individuals may
be more likely to research and understand different policy options before making a
purchase.
7. Geographic Location: Cultural norms and economic conditions in different regions
can impact the perceived importance of life insurance and the types of policies
preferred by consumers.
8. Health Status: Individuals with pre-existing health conditions may face challenges in
obtaining life insurance coverage or may be subject to higher premiums. Healthier
individuals may have more options and may qualify for lower rates.
9. Life Stage: Consumers at different life stages may have varying priorities regarding
life insurance. For example, young couples may prioritize income protection and
mortgage coverage, while retirees may focus on estate planning and final expense
coverage.
10. Gender: While gender-based pricing for life insurance has become less common,
historical differences in life expectancy between men and women may have
influenced insurance purchasing decisions in the past.

DEMOGRAPHIC FACTORS PLAY AN IMPORTANT ROLE IN CONSUMER

BUYING BEHAVIOR IN LIFE INSURANCE

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Demographic factors play a crucial role in consumer buying behavior for life insurance for
several reasons:

1. Understanding Consumer Needs: Demographic factors such as age, gender,

education, marital status, and income can help predict the demand for insurance. This
understanding enables insurers to prepare their marketing strategies and design
products as per the requirements of the people.
2. Targeted Marketing: Insurers can target specific demographic or geographic
segments to expand their market. For instance, middle-aged people, service holders,
and individuals with a moderate-income range have been found to have more
awareness about life insurance products.
3. Risk Assessment: Certain demographic factors can influence the risk associated with
an individual. For example, age and health status can significantly impact the pricing
of life insurance policies.
4. Product Customization: Insurers can tailor their products to meet the specific needs
of different demographic groups. For example, a young, single individual might be
more interested in a policy with investment benefits, while a married individual with
children might prioritize a policy with substantial death benefits.
5. Consumer Loyalty: Understanding the demographic factors can also help in building
consumer loyalty. Insurers can provide more personalized services and products,
leading to higher customer satisfaction and retention.
In summary, demographic factors provide valuable insights into consumer behavior, enabling
insurance companies to offer more relevant and appealing products to their potential
customers.

HOW DEMOGRAPHIC FACTORS INFLUENCE CONSUMER BUYING DECISION

IN LIFE INSURANCE:

Demographic factors play a significant role in influencing consumer buying behavior in the
life insurance industry. These factors include age, gender, income, education level, marital
status, family size, occupation, and geographic location. Here's how each of these factors can
impact consumer behavior in life insurance, along with examples:

1. Age: Different age groups have varying life insurance needs and preferences.
Younger individuals may prioritize coverage for dependents or mortgage protection,
while older individuals may focus on retirement planning or final expense coverage.
Example: A 25-year-old single individual might opt for a term life insurance policy to cover
outstanding student loans and provide financial security for their future family.
2. Gender: Traditionally, women tend to live longer than men, which can affect their
life insurance rates. Additionally, gender roles may influence coverage preferences.
Example: Due to longer life expectancy, a female may be offered lower premiums for a
similar life insurance policy compared to a male of the same age and health status.

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 3. Income: Higher income individuals may opt for larger coverage amounts or more
comprehensive policies, whereas lower income individuals may prioritize
affordability.
Example: A high-income executive might purchase a whole life insurance policy with cash
value accumulation as part of their estate planning strategy, while a lower-income family
might choose a term life policy to cover immediate financial needs at a lower premium.
4. Education Level: Education level can impact consumer awareness and understanding
of life insurance products, influencing decision-making processes.
Example: A college-educated individual may be more likely to understand the nuances of
various life insurance policies and make informed decisions based on their financial goals.
5. Marital Status: Married individuals may have additional financial responsibilities,
such as supporting a spouse or children, which can influence their life insurance
needs.
Example: A married couple with young children may purchase a joint life insurance policy to
ensure financial protection for their family in the event of either spouse's death.
6. Family Size: The number of dependents can affect the amount of coverage needed
and the type of policy selected.
Example: A family with multiple children may opt for a larger life insurance policy to ensure
adequate financial support for each child's education and living expenses.
7. Occupation: Riskier occupations may result in higher premiums due to increased
likelihood of injury or death.
Example: A construction worker may pay higher premiums for life insurance compared to an
office worker due to the higher occupational hazards associated with their job.
8. Geographic Location: Factors such as cost of living, crime rates, and access to
healthcare can influence life insurance purchasing decisions.
Example: Individuals residing in areas prone to natural disasters may prioritize purchasing
life insurance with additional coverage for such events to protect their families' financial
stability.
Understanding how these demographic factors intersect with consumer behavior in the life
insurance industry allows insurance providers to tailor their products and marketing strategies
to effectively meet the diverse needs of their target markets.

COMPARSION BETWEEN DEMOGRAPHIC FACTORS:

Certainly! Let us compare the impact of different demographic factors on consumer buying
behavior in the life insurance industry:

1. Age vs. Gender:

- Age: Age influences life insurance needs and preferences at distinct stages of life.
Younger individuals may prioritize coverage for dependents or mortgage protection, while
older individuals may focus on retirement planning or final expense coverage.

17
 - Gender: Gender plays a role in determining life expectancy and thus affects life insurance
premiums. Women, on average, have longer life expectancies than men, leading to potentially
lower premiums for similar coverage.
Example: A 40-year-old male executive and a 40-year-old female executive may seek similar
life insurance coverage. However, due to actuarial tables indicating longer life expectancies
for women, the female executive might be offered lower premiums for the same coverage
amount compared to her male counterpart.

2. Income vs. Education Level:

- Income: Higher income individuals may opt for larger coverage amounts or more
comprehensive policies, while lower income individuals may prioritize affordability.
- Education Level: Education can impact consumer awareness and understanding of life
insurance products. Higher education levels may lead to better-informed decisions regarding
coverage options and financial planning.
Example: A high-income professional with a graduate degree may opt for a whole life
insurance policy with cash value accumulation as part of their comprehensive financial plan.
In contrast, a lower-income individual with a high school education might prioritize
affordability and opt for a term life policy to cover immediate financial needs.

3. Marital Status vs. Family Size:

- Marital Status: Married individuals may have additional financial responsibilities, such as
supporting a spouse or children, influencing their life insurance needs.
- Family Size: The number of dependents affects the amount of coverage needed and the
type of policy selected. Larger families may require more extensive coverage to provide for
each member adequately.
Example: A married couple with two children may have different life insurance needs
compared to a single individual with no dependents. The married couple might opt for a joint
life insurance policy to provide financial protection for their family, while the single
individual may choose a term life policy to cover personal debts or obligations.

4. Occupation vs. Geographic Location:

- Occupation: Riskier occupations may result in higher premiums due to increased
likelihood of injury or death. Certain professions may also have group insurance options or
specialized coverage.
- Geographic Location: Factors such as cost of living, crime rates, and access to healthcare
can vary by location and influence life insurance purchasing decisions. Individuals in areas
prone to natural disasters may seek additional coverage for such events.
Example: A construction worker residing in an area prone to natural disasters may face
higher insurance premiums due to the occupational risks associated with their job and the
geographic location's susceptibility to hazards. In contrast, an office worker in a low-risk area
may pay lower premiums for similar coverage.

5. Gender vs. Marital Status:

18
 - Gender: Gender influences life expectancy and premium rates. Women, typically having
longer life expectancies, may receive lower premiums for similar coverage.
- Marital Status: Marital status affects financial responsibilities and thus life insurance needs.
Married individuals may require coverage to support a spouse or children in case of death.
Example: A married woman and a single woman of the same age may have different life
insurance needs. The married woman may seek coverage to protect her spouse and children
financially in case of her death, while the single woman may prioritize coverage for personal
debts or future financial goals.

6. Age vs. Occupation:

- Age: Different life stages have varying insurance needs. Younger individuals may
prioritize coverage for future financial obligations, while older individuals may focus on
retirement planning.
- Occupation: Certain occupations carry higher risks, leading to higher premiums. Age and
occupation combined can influence the type and amount of coverage individuals may seek.
Example: A 30-year-old doctor and a 30-year-old construction worker may have different
life insurance needs due to their respective occupations and life stages. The doctor, with a
potentially higher income and longer career trajectory, may opt for a more comprehensive
policy to protect against potential future income loss, while the construction worker may seek
coverage tailored to the occupational risks associated with their job.

These comparisons illustrate how various demographic factors interact to shape consumer
behavior in the life insurance market. Understanding these dynamics allows insurers to
develop targeted products and marketing strategies to effectively meet the diverse needs of
different demographic segments.
These examples demonstrate how various demographic factors intersect and influence
consumer behavior in life insurance purchasing decisions. Insurers use such insights to design
products and pricing structures that cater to the diverse needs and preferences of different
demographic segments.

19
 CHAPTER 2
RESEARCH METHODOLOGY

Research Methodology:
Research methodology refers to a structured and scientific approach used by researchers to
collect, analyze, and interpret data to answer research questions or test hypotheses. It
provides a framework for defining research questions, hypotheses, and objectives, guiding
researchers in selecting appropriate research designs, sampling techniques, and data
collection and analysis methods. The key components of research methodology include
research design, sampling, tools, data collection procedures, data analysis methods, and
ethical considerations. It is crucial in ensuring the reliability, validity, and ethical conduct of
research, helping researchers plan their studies efficiently and achieve their objectives
effectively.

Research Objectives:
1. Identification of Key Demographic Segments.
2. Analysis of Consumer Preferences.
3. Evolution of Psychological Factors.
4. Assessment of Socio-Economic Influences.
5. Investigation of Marketing Channels.
6. Comparison of Consumer Behaviors.
7. Examination of Regulatory and Policy Implications.
8. Examination of Life Events and Lifecycle Stages.
9. Assessment of Financial Literacy and Risk Awareness.
10. Understanding Decision Making Process.
11. Exploration of Perceived Barriers and Motivators.
12. Validation of Hypothesis and Model.

Scope for the Study:

The scope of study for factors affecting consumer buying behavior regarding life insurance
demographic factors encompasses an investigation into how demographic characteristics
influence the purchasing decisions of life insurance policies. This includes analyzing how
factors such as age, gender, education level, income, and other socio-demographic variables
impact individuals' decisions to purchase life insurance. Research in this area aims to
understand the correlation between demographic factors and the propensity to buy life
insurance, shedding light on how these variables influence consumer behavior in the
insurance market. By examining the interplay between demographic characteristics and
purchasing decisions, researchers can gain insights into the preferences, perceptions, and
motivations that drive individuals to invest in life insurance products.

Significance of the Study:

The significance of studying factors affecting consumer buying behavior regarding life
insurance demographic factors lies in its ability to provide valuable insights for insurance
20
companies and marketers. By understanding how demographic characteristics influence
individuals' decisions to purchase life insurance, companies can tailor their marketing
strategies, product offerings, and customer service to better meet the needs and preferences of
different demographic groups. This research helps in optimizing marketing campaigns,
developing targeted products, and enhancing customer satisfaction by aligning offerings with
the specific requirements of diverse demographic segments. Ultimately, studying these
factors enables companies to improve customer engagement, increase sales, and build long-
term relationships with clients, leading to a more effective and customer-centric approach in
the life insurance industry.

Selection of Problem:
This topic was selected to understand how Demographic Factors influence an individual’s
buying behavior and preferences.

Research Design: This study aims to understand the consumer purchase intentions of Life
insurance policies in the city of Kalyan-Dombivli and used a descriptive and analytical
research design in this study with the help of a structured questionnaire. The study uses
convenience sampling for selecting the respondents from across the region.

Population of the Study (Sample Size): The data was gathered in accordance with the
responses of 80 candidates who received an online questionnaire and provided a sample size.

Data Collection: Data for this study included primary sources and secondary sources.
a. Primary Source: A questionnaire was used to collect the essential
information that was distributed to respondents via social media channels like
Instagram, WhatsApp, and E-mail. Google forms were used for data
collection. The questionnaire focused on demographic and general information
related to level of satisfaction.
b. Secondary Source: Secondary Data incudes published and unpublished work
done by others, as this will help in better understanding of the research
problem and to make future comparisons. It will be used to provide a base for
research problem.

Statistical Tools and Techniques Used for Analysis: The statistical techniques and tools
employed in this study's analysis consist of Google forms. Microsoft Excel was used for the
purpose of analysis.

21
Limitations of the study:
Every study has some limitations and so is this study. Some limitations for this study are as
follows:

1. Scope of the study is wider but the Sample size is limited to Kalyan-Dombivli only.
2. This research study is mainly based on primary data collected through questionnaire.
Results are subject to common limitation of accuracy of response.
3. The quality of research depends on quality of data and reliability of data filled by the
respondents.
4. Results of this Data are confined and limited to Kalyan-Dombivli only.
5. The sample size taken here is small. i.e. 80 respondents only due to time constraint.

22
 CHAPTER 3
REVIEW OF LITERATURE

Dr. Indrani Majumder (2021) in her Research journal says that the elementary purpose of
insurance is to allow security against future risk, accidents and uncertainty by fixing the
likely volume of risk by assessing diverse factors that give rise to risk. Though it cannot
arrest the risk from taking place but can compensate the losses arising with the risk. This
instrument helps to share the financial loss as all the insured add the premiums towards a
fund and out of which the people facing a specific risk are paid. Insurance warns individuals
and businessmen to absorb appropriate device to prevent unfortunate consequences of risk by
observing safety instructions. With the enhanced competition amongst the insurance
companies nowadays prospective customers are facing difficulty in choosing an appropriate
company. The present study has tried to identify the factors that are influencing the choice of
life insurance companies.

Ms. Babita Yadav, in her research paper says that Life insurance is an important form of
insurance and essential for every individual. Life insurance penetration in India is very low as
compared to developed nation where almost all the lives are covered, and stage of saturation
has been reached. Customers are the real pillar of the success of life insurance business and
thus it's important for insurers to keep their policyholders satisfied and retained as long as
possible and also get new business out of it by offering need based innovative products.
There are many factors which affect customers' investment decision in life insurance and
from the study it has been concluded that demographic factors of the people play a major and
pivotal role in deciding the purchase of life insurance policies.

Dr. Praveen Sahu, Gaurav Jaiswal, and Vijay Kumar Pandey have studied the
consumer’s perception towards Life Insurance Policies is positive. It developed a positive
mindset for their investment pattern, in insurance policies. Still some actions are needed for
developing the insurance market. The major factors playing the role in developing
consumer’s perception towards Life Insurance Policies are Consumer Loyalty, Service
Quality, Ease of Procedures, Satisfaction Level, Company Image, and Company-Client
Relationship.

Ravi Kumar Tati, Ernest Beryl B. analyzed that According to this study, the
overall perception of investors towards life insurance is found to be positive. If the
private insurance companies try to provide and serve the investors with service
quality coupled with empathy and assurance, India could become a biggest market
for any insurance company. This study was focused to identify the underlying
reasons, facts that influence the investors to invest in life insurance. The majority of
the customers feel insurance is a tax saving option than risk protection and should
be a multi-faceted investment option. If their investment patterns are analyzed, the
majority of the investors prefer long term investments options. The study concluded

23
that there is no association between annual income of investors and factors
influencing choice of investment in life insurance. The major influencing factors in
choosing an insurance company in the future are supposed to be investor
relationships, company image and lower premium.

Mini Agrawal, Nidhi Agrawal (2017) says the progress of life insurance is far
from satisfying the customers in India, people still think it is worthless to have a life
insurance policy and this indicates that the demographic factors in some way are
influencing the purchaser’s decision and creates some problem in the way of
purchasing life insurance policies in our country. Life Insurance Company plays a
dynamic role in the social well-being or in creating a social security of human society
by providing life insurance to millions of persons against risks and uncertainties of
life such as risk management against death risk, accident or physical disability
during contractual period. Acquiring life insurance policies by few wealthy people in
the society is not going to be the solution for all the life insurers. People need to
understand that each and every individual has to be covered under life insurance
and only after that can the purpose of life insurance be accomplished in the right
sense. Analyzing and understanding the attitude and thinking of the customers of
life insurance on the basis of their demographic characteristics in particular
geographical regions, thus becomes important. The low level of development of life
insurance sectors indicates that there is potential for growth. The study investigates
the demographic factors that affect purchasing decision of life insurance policy.

Dr. Kalpesh Kumar B. Prajapati and Dr. Jaideep Singh H. Jetawat (2022) have analyzed
the Buying behavior and Based on analysis of collected data it can be concluded that factors
influencing decision of customers purchasing life insurance product like needs fulfillment,
awareness of product, liquidity, price of insurance product, modes of payment, agent's roles,
my friends, family members, my colleagues, image of the company, pamphlets/brochure of
products ,internet/website , paying premium through my employer, location of the branch
office, claim settlement process ,complaint redressal process , medical check- up
process ,long term commitment given by the company, trustworthiness of the
company ,professional management of my premium ,After sales service ,former experience
with insurer are dependent on age. Return of the insurance companies, sum assured,
affordability and beneficiary of insured person, advertisement, Documentation work,
technology of the company does not influence on age groups.

24
Binny Pahwa, Meenu Gupta (2019) said in this study, 21 critical factors have been
identified for analysis of health insurance. According to study it has been found that product
related factors, Tax gains‟, coverage about diseases, Attitude, awareness, income, and age
were the key factors.

Muthusamy and Yuvarani (2016) Concluded that age, gender and income were vital factors
in purchasing of life insurance product. LIC is the most preferred brand because of company
image

Ganga Susheel, Khushboo Kesharwani found that majority i.e. 56 percent of the
respondents have opted for private insurance companies and Age is not a dependent factor on
selection of the type of insurance companies, but age definitely matters with respect to
holding of insurance policies. Respondents who are above 31 years of age constitute 60
percent of policy holders. 35 percent of policy holders opt for insurance for seeking old age
benefits (financial security). It is also found that people who don’t opt for insurance are
anxious about their future financial job security and are increasingly tired of frequent changes
in the work environment.

Mr. Dhanush S R (2014) exclaims as there is completion in every sector change in

economies of scale regarding to consumer expectations. The insurance sector has bought in
these unique aspects such as customer education and vast changes in the role and
responsibility of the intermediaries to the distribution channel.

Dr. A. K Sarada (2014) study reveals that the factors affecting the purchase of life insurance
policies like company image, premium amount, claim settlement, maturity benefit, services
quality, risk coverage and financial security, amount of maturity, premium rate, liquidity,
after sales service, tax saving, profit, money value have direct and significant positive effect
on the overall satisfaction with insurance Policies of life insurance among the public and
private sector policyholders.

25
 CHAPTER 4
DATA ANALYSIS AND INTERPRETATION

4.1. AGE

AGE FREQUENCY PERCENTAGE

18-25 51 63.7%
25-40 14 17.5%
40-55 14 17.5%
55 and above 01 1.2%
Total 80

%
55 and above
1%

40-55
18% 18-25
25-40
40-55
55 and above
25-40
18%
18-25
64%

Data Interpretation:

Age demographics show that 64% of respondents are between the ages of 18 and 25.
The age group of 25–40 makes approximately 17%. The age range of 40–55 accounts for
17% of the total, while 55 and older comprise 1% of the lowest.

26
 4.2. GENDER:

GENDER FREQUENCY %
MALE 51 63.7
FEMALE 29 63.3

FEMALE
36%

MALE
64%

Data Interpretation:

We can observe from the pie-chart above that 29% of respondents were female and 64% of
respondents were male when they took part in the study.

27
4.3. EDUCATIONAL QUALIFICATION:

EDU. Qualification Frequency %

SSC 7 8.8%
HSC/Diploma 34 42.5%
Graduate 28 35%
Post Graduate 11 13.7%

9%
14%

SSC
HSC/Diploma
Graduate
Post Graduate

43%
35%

Data Interpretation:
The pie chart above illustrates that, at 42%, HSC/Diploma participants make up the
largest percentage of study participants. A third of them are graduates. Of them, 9%
are SSC and 14% are postgraduate.

28
 4.4. MARITIAL STATUS:

MARITIAL STATUS FREQUENCY %

SINGLE 49 61.3%
MARRIED 28 35%
DIVORCED 3 3.7%

%
SINGLE MARRIED DIVORCED

DIVORCED
4%

MARRIED
35%

SINGLE
61%

Data Interpretation:

According to this pie-chart, 61% of respondents are single. About 35% of respondents are
married, whereas 4% of respondents are divorced.

29
4.5. ANNUAL INCOME:

INCOME GROUPS FREQUENCY %

Less than 100000 44 55%
100000-300000 11 13.7%
300000-500000 9 11.3%
500000 and above 16 20%

INCOME GROUP
500000 & above
20%

300000-500000
11%
Less than 100000
55%

100000-300000
14%

Data Interpretation:
This pie chart shows that 55% of the respondents, or the majority, make less than
100,000 annually. Of the respondents, 14% are in the 100000-300000 bracket. 11% of
responders are in the 300000–500000 range, while 20% are in the 500000+ range.

30
 4.6. OCCUPATION:

OCCUPATION FREQUENCY %
STUDENT/RETIRED/ 51 63.7%
UNEMPLOYED
PROFESSIONALS 8 18.8%
PRIVATE SECTORS 15 10%
CIVIL SERVICES 6 17.5%

OCCUPATION
UNEMP/RET/STU PROFESSIONALS PRIVATE CIVIL

16%

9%

58%

17%

Data Interpretation:

Retired, students, and unemployed people make up 58% of the research in this piechart.
Professional line makes up 9%. Civil services make up 16%. And 17% going to private
sectors.

31
4.7. PRIMARY RESIDENCE:

RESIDENCE FREQUENCY %
URBAN 41 51.8%
SEMI-URBAN 39 48.8%

PRIMARY RESIDENCE
51.20% PRIMARY RESIDENCE

48.80%
URBAN SE M I - URBAN

Data Interpretation:
According to this bar graph, 51% of respondents live in urban areas and 49% in semi-
urban areas.

32
4.8. How familiar are you with different types of life insurances?

FAMILIARITY FREQUENCY %
VERY FAMILIAR 29 36.3%
SOMEWHAT 39 48.8%
FAMILIAR
NOT VERY FAMILIAR 12 15%
NOT FAMILIAR AT 0 0%
ALL

FAMILIARITY

17% VERY FAMILIAR

35% SOMEWHAT FAMILIAR
NOT VERY FAMILIAR
NOT FAMILIAR AT ALL

47%

Data Interpretation:
The majority of people are at least somewhat aware of the many types of insurance, as
shown by the pie chart. Merely 35% possess complete knowledge regarding various
forms of insurance. 18% of people don't know much about it. This pie chart shows
that everyone knows something or everything about insurance.

33
4.9. IMPORTANT FACTORS CONSIDERED WHILE PURCHASING LIFE
INSURANCE:

FACTORS FREQUENCY %
PREMIUM 11 13.8%
AFFORDABILITY
COVERAGE AMOUNT 21 26.3%
POLICY FEATURES 26 32.5%
BRAND REPUTATION 2 2.5%
FINANCIAL STABILITY 7 8.8%
RECOMMENDATION 5 6.3%
TAX BENEFIT 4 5%
EASE IN CLAIM 4 5%
SETTLEMENT.

IMPORTANT FACTORS CONSID-

ERED WHILE PURCHASING LIFE
INSURANCE:

30 26
25 21
20
15 11
10 7
5 4 4
5 2
13.80% 26.30% 32.50% 2.50% 6.30% 5.00% 8.80%
0
PREM. AFF COVG. POL. FT B. REP. RECC. TAX BEN. FIN. STB CLAIM
AMT SET.

FREQ. %

Data Interpretation:
The majority of respondents, or 26 respondents (32.5%), in the bar graph above,
purchased life insurance in order to benefit from the policy's characteristics. 26.3% of
the second majority have accepted it in order to recoup the coverage cost. 13.8% of
people struggle with the cost of premiums. The factors that have respondents within
10% of each other are: tax benefit, recommendation, financial stability, brand
reputation, and claim settlement.

34
4.10. PERIOD OF LIFE INSURANCE COVERAGE:

TIME PERIOD FREQUENCY %

TEMPORARY (TERM 25 31.3%
LIFE INSURANCE)
LIFETIME (WHOLE 44 55%
LIFE INSURANCE)
ENDOWMENT PLAN 8 10%
ULIP 3 3.7%

TIME PERIOD

4%
10% TEMPORARY
31% LIFE TIME
ENDOWMENT
ULIP

55%

Data Interpretation:
In this Pie Chart, it is observed that majority have selected Whole life insurance i.e.
55% and Term life insurance on the other hand has 31% respondents. Endowment is
on 10%. ULIP being the lowest being chosen by only 4%.

35
4.11. PRIMARY GOALS FOR PURCHASING LIFE INSRUANCE:

GOALS FREQUENCY %
Income replacement for 24 30%
dependents
Mortgage or debt 6 7.5%
repayment
Education funding for 10 12.5%
children
Retirement savings 15 18.8%
Legacy planning/estate 6 7.5%
protection
Tax saving 6 7.5%
Wealth creation 13 16.2%

30

25 24

20
15
15 13
10
10
6 6 6
5
30.00% 7.50% 12.50% 18.80% 7.50% 7.50% 16.20%
0
P. E . .
G D V CT V N
RE A N SA TE SA TI
O
E G FU T EA
M RT U EN RO X
CO /P TA CR
M
O ED EM N
IN T/ IR
A H
EB T PL LT
D RE TE EA
TA W
ES

FREQ. %

Data Interpretation:
As seen from the bar graph, most of the respondents i.e. 30% have primary goals as
income replacement for dependents. While 16% have purchased it for Wealth
creation. 19% of purchased it for retirement savings. 13% have purchased it as
Education funding for Children in future. Other goals like Repayment of
Debt/Mortgage, Estate planning/protection, and Tax saving have 22% in total
responses.

36
4.12. RISK INVOLVED IN OCCUPATION IN RELATION TO LIFE
INSURANCE:

RISK INVOLVEMENT FREQUENCY %

LOW 22 27.5%
MODERATE 30 37.5%
HIGH 7 8.8%
NOT APPLICABLE 21 26.2%
(STUDENT, RETIRED,
ETC)

RISK
LOW MODERATE HIGH NOT APPLICABLE

26% 28%

9%

38%

Data Interpretation:
According to the pie chart above, 37% of workers have a moderate job risk and 28%
have a low one. Retirement, education, and unemployment account for 26% of the
total. Only 9 percent of people have a high work risk.

37
4.13. CHANNELS TO RECEIVE INFORMATION ABOUT LIFE INSURANCE
PRODUCTS.

CHANNELS FREQUENCY %
ONLINE 17 21.3%
PLATFORM/WEBSITE
AGENT/BROKER 40 50%
SOCIAL MEDIA 17 21.3%
TELEVISION/RADIO 5 6.3%
PRINTED MATERIALS 1 1.2%

CHANNELS
ONLINE AGENT/BROKER SOCIAL MEDIA T.V/RADIO PRINT MEDIA

6% 1%
21%

21%

50%

Data Interpretation:
In the above pie-chart, the study shows that half of the total respondents get
information through Insurance agents/Brokers. 21% of the respondents get it through
Online channel and the other 21% get it through Social media. Print media and
T.V/Radio contribute only 1% and 7% of information respectively.

38
4.14. RECENT LIFE EVENTS THAT INFLUENCED THE CONSIDERATION
OF LIFE INSURANCE:

INFLUENCE FREQUENCY %
YES 20 25%
NO 48 60%
MAYBE 12 15%

INFLUENCE
YES NO MAYBE

15%
25%

60%

Data Interpretation:
From the above pie-chart, 25% had purchased life insurance because of influence
of some recent life event such as job change. Birth of a child, etc. Majority of
respondent don’t have an influence of recent life event of purchase life insurance.
15% may had an influencing life event that resulted in purchase of life insurance.

39
4.15. CONCERNS AND BARRIERS WHILE PURCHASING LIFE
INSURANCE:

BARRIER/CONCERN FREQUENCY %
COST/AFFORDABILITY 20 25%
LACK OF 15 18.8%
UNDERSTANDING
TRUST 22 27.5%
COMPLEX BUYING 9 11.3%
PROCESS
OTHER REASON 14 17.5%

CONCERNS AND BARRIERS WHILE

PURCHASING LIFE INSURANCE
FREQUENCY %
20 22
15
14
25.00% 9
18.80% 27.50%
11.30%
17.50%
TY G
I LI IN ST
B D U SS N
A N TR CE SO
RD ST
A O A
FF
O
ER PR RE
G
/A N
D
IN ER
ST U Y TH
CO O
F BU O
X
CK LE
LA M
P
CO

Data Interpretation:
According to the bar graph above, trust is a significant obstacle when it comes to
buying life insurance. Twenty-five percent struggle with affordability. About 19%
don't know enough about the product. The complicated purchasing process is the
reason why 11% don't buy it. 17% of people might not have bought life insurance
for other reasons.

40