Determinants of Life Insurance Uptake Among Secondary School Teachers In Tetu Sub- County Nyeri County

Abstract

Considerable evidence suggests that many people for whom insurance is worth purchasing do not have coverage. It is against this background that this study examined factors that influence secondary school teachers in Kenya to purchase life insurance policies. The study identified four objectives namely; to assess the extent to which the level of awareness of insurance products affect their uptake by teachers; to determine the influence of alternative risk mitigating opportunities on the uptake of insurance products; to evaluate the effects of the affordability of insurance products on their uptake; and to establish the influence of individual risk aversion on the uptake of insurance products. To achieve these objectives the study adopted survey research design and a questionnaire was used to collect data from the respondents. A stratified and random sampling was used to draw a sample size of 191 from the target population of 368 teachers in public secondary school within the Tetu Sub-County. The data collected was analyzed using SPSS software. Descriptive statistics was used to describe the teachers' demographic characteristics, income level, sources of income and education level. Probit model and Gill square were used to evaluate the influence of the independent variables on the dependent variable. The .study found that teachers are aware of insurance products but opt not to subscribe; risk aversion is not a major consideration whereas the cost insurance premium and availability of risk mitigating opportunities affect teachers' preferences. The study suggests that higher uptake might be achieved by taking these preferences and their determinants into account in redesigning insurance products; ease the procedures of subscribing; and provide loans on teachers' savings on premiums.