Determinants of Life Insurance Demand: Evidence from Ethiopia

Tilahun Shewangezaw

dc.contributor.author	Tilahun Shewangezaw
dc.date.accessioned	2021-08-20T08:31:50Z
dc.date.available	2021-08-20T08:31:50Z
dc.date.issued	2021-08
dc.identifier.uri	http://ir.bdu.edu.et/handle/123456789/12522
dc.description.abstract	Life insurance is a financial product that aims to protect dependents against the risks of premature death or disability of the insured party. Although life insurance has a lot of benefits financially, socially, and economically various pieces of evidence and literature show that the level of life insurance business and its demand in Ethiopia is very low. As a result, this thesis paper focused on potential ways of increasing the life insurance demand by investigating the determinants of the demand for life insurance in Ethiopia. Specifically, this study aims to investigate the effect of savings, growth in per capita income, total population growth, urbanization, political instability, and health expenditure to GDP on demand for life insurance in Ethiopia in both the short run and long run by using a secondary source of data collected between 1995 and 2019. The study employed both descriptive statistics and the Autoregressive distributive lag model (ARDL) to compute the characteristics of institutional (political instability), social security (health expenditure to GDP), macro-economic (savings and growth in per capita income), and demographic (total population growth and urbanization) factors and to identify their effect on demand for life insurance respectively. The findings of the study revealed that savings, growth in per capita income, total population growth, urbanization, and political instability have a positive and significant effect on demand for life insurance in Ethiopia in the long run. Whereas, health expenditure to GDP has been found insignificant in the long run. In addition, all variables do not affect life insurance demand in the short run except total population growth and political instability which has a positive effect. Therefore, the researcher recommends that the government and other stakeholders should implement different policy measures to increase per capita income, savings, and urbanization to improve life insurance purchases in Ethiopia. In addition, life insurance providers should increase their effort to create more awareness and demand regarding life insurance to take advantage of the increase in urbanization, total population, and current political volatility of Ethiopia.	en_US
dc.language.iso	en	en_US
dc.subject	ACCOUNTING AND FINANCE	en_US
dc.title	Determinants of Life Insurance Demand: Evidence from Ethiopia	en_US
dc.type	Thesis	en_US