Socio-economic Factors Affecting Changes in Demand for Life Insurance

Abstract

Life insurance has low penetration among Indian households, with insurance premiums accounting for about 2.72 % of GDP7 . Due to lack of access to formal financial markets and low levels of financial literacy many Indian households do not effectively plan their financial future. With an increasing emphasis by the government towards greater financial inclusion of all sections of the society, it is important to understand how socio-economic and demographic aspects of rural and urban households affect their decisions to acquire or discontinue life insurance coverage.