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What drives life insurance purchasing decisions in Bosnia and Herzegovina?

Safet Kozarevic () and Sanida Hodzic

Risk Management and Insurance Review, 2021, vol. 24, issue 3, 263-278

Abstract: Life insurance has become increasingly relevant in Bosnia and Herzegovina (BiH) over the last 10 years. The market is still underdeveloped with low life insurance density (EUR 23.2 per capita in 2019), however, it shows great potential with growth rates averaging 8.7%. The examination of the drivers of life insurance demand should instruct life insurers and policymakers to implement strategies to accelerate the life insurance development in BiH. Life insurance purchasing decisions are influenced by series of determinants, reflecting the customers' experiences and preferences. The purpose of this paper is to examine the determinants of customer life insurance purchasing decisions. We consider the following factors: Income, insurance policy price, propensity to save, insurance policy yield, product‐offer, corporate image, and brand. The research covers the existing and potential customers in BiH. Two hundred respondents participated in a survey who were selected according to different sociodemographic characteristics. The main findings show the relevance of particular determinants and their differences that can be helpful for insurance companies in creating their strategy for market growth.

Date: 2021
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https://doi.org/10.1111/rmir.12189

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