A STUDY ON INVESTOR’S PERCEPTION TOWARDS LIFE INSURANCE

INVESTMENTS

BY

VARALAKSHMI K

(Reg. no: 130722631057)

OF

JERUSALEM COLLEGE OF ENGINEERING

(An Autonomous Institution, Affiliated to Anna University)

NARAYANAPURAM, PALLIKARANAI,

CHENNAI-600100

A SUMMER PROJECT REPORT

Submitted to the

DEPARTMENT OF MANAGEMENT STUDIES

In partial fulfillment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

August 2023
 BONAFIDE CERTIFICATE

Certified that this Project report titled “A STUDY ON INVESTORS PERCEPTION TOWARDS
LIFE INSURANCE INVESTMENT” is a Bonafide work of VARALAKSHMI K (130722631057)
who carried out the research under my supervision. Certified further, that to the best of my knowledge the
work reported here does not form part of any other project report or dissertation on the basis of which a
degree or award was conferred on an earlier occasion of this or any other candidate.

SUPERVISOR HEAD OF THE DEPARTMENT

Submitted to project and viva examination held on………….

INTERNAL EXAMINER EXTERNAL EXAMINER

 DECLARATION
Myself, VARALAKSHMI K (130722631057) a Bonafide student of Department of Management Studies of
JERUSALEM COLLEGE OF ENGINEERING, CHENNAI -100, declare that the Project title “A Study
On Investors Perception Towards Life Insurance Investment” in partial fulfillment for the award of
Master of Business.

Date:
Place: CHENNAI (VARALAKSHMI K)
 ABSTRACT

The research project entitled „A STUDY ON INVESTORS PERCEPTION TOWARDS LIFE

INSURANCE INVESTMENT‟ is an attempt to understand the perception of investor‟s life insurance
investment; the data were collected through questionnaires. This research study aims to investigate and
analyze the perceptions of investors towards life insurance as an investment instrument. Life insurance is a
significant component of financial planning, offering both protection and investment opportunities. The
research design used for this study is descriptive in nature. The descriptive study helps the researcher to find
out various characteristics of the population. The snow ball sampling technique was adopted for selecting
sample units from the population. The method of data collection for the study includes both primary and
secondary data. A sample of 100 members was helped to analyze their perception towards investment in life
insurance. The statistical tool used for analyzing and interpreting the perception of investors and the tools
includes percentage analysis (chi square, anova, weighted average). The results were presented with the
help of charts and diagrams were drawn from the analyzing of data. The suggestions and conclusions have
been made based on the findings.
 ACKNOWLEDGEMENT

I would like to thanks Dr. M. MALA, M.A, M. Phil., and CEO, Jerusalem College of Engineering for the
sustained support in providing all the resources required to complete the project.

I would like to thanks Dr. M. RAMALINGAM, B.E, M.S, PhD, Director, and Jerusalem College of
Engineering for his support in providing all the resources required to complete the project.

I would like to thanks Dr. RAMESH S, [Link], PhD, and Principal of Jerusalem College of Engineering
for his support in providing all resources to complete the project.

I wish to regard my sincere thanks to Dr. S. MUTHUMANI, MBA, PhD, Head of the department,
Jerusalem College of Engineering, for his moral support and continuous encouragement.

I wish to regard my sincere thanks to Dr. S. MADHIYARASI, MBA, PhD, [Link], project guide
and all the faculty members of MBA department for their valuable advice and guidance without that the
project report would not have emerged as successful one.

I am grateful to my friends who having rendered their helping hands to do this project report successfully. I
also express my sincere gratitude to my parents for their moral support and financial help who were
responsible for my stand at this point.

VARALAKSHMI K
(130722631057)
 TABLE OF CONTENT

CHAPTER TITLE Page no

ABSTRACT

LIST OF TABLES

LIST OF FIGURES

1 INTRODUCTION

1.1 INTRODUCTION OF THE STUDY 1

1.2 INTRODUTION TO THE INDUSTRY 2

1.3 OBJECTIVES OF THE STUDY 10

1.3.1 PRIMARY OBJECTIVE 10

1.3.2 SECONDARY OBJECTIVE 10

1.4 SCOPE OF THE STUDY 11

1.5 NEED OF THE STUDY 12

1.6 LIMITATIONS OF STUDY 13

2 LITERATURE SURVEY 14

REVIEW OF LITERATURE 14

3 RESEARCH METHODOLOGY 20

3.1 RESEARCH DESIGN 20

3.2 COLLECTION OF DATA 20

3.2.1 PRIMARY DATA 20

3.2.2 SECONDARY DATA 20

3.3 SAMPLING TECHNIQUE 21

3.4 SAMPLE SIZE
21
3.5 TOOLS FOR ANALYSIS
21
3.5.1 PERCENTAGE ANALYSIS
21
3.5.2 WEIGHTED AVERAGE
21
3.5.3 CHI- SQUARE
22
3.5.4 ANOVA
22

4 DATA ANALYSIS AND INTERPRETATIONS 23

4.1.1 PERCENTAGE ANALYSIS FOR GENDER OF THE RESPONDENT
23
 4.1.2 PERCENTAGE ANALYSIS FOR AGE OF THE RESPONDENT 24

4 .1.3 PERCENTAGE ANALYSIS FOR EDUCATIONAL BACKGROUND OF THE 25

RESPONDENT
4.1.4 PERCENTAGE ANALYSIS FOR OCCUPATION OF THE RESPONDENT 26

4.1.5 PERCENTAGE ANALYSIS FOR ANNUAL INCOME OF THE RESPONDENT 27

4.1.6 PERCENTAGE ANALYSIS FOR MARITAL STATUS OF THE RESPONDENT 28

4.1.7 PERCENTAGE ANALYSIS FOR NO OF DEPENDENTS OF THE RESPONDENT 29

4.1.8 PERCENTAGE ANALYSIS FOR FACTORS INFLUENCED RESPONDENT DECISION 30

TO INVEST IN LIFE INSURANCE POLICIES
4.1.9 PERCENTAGE ANALYSIS FOR RESPONDENT DECISION NOT TO INVEST IN LIFE 31
INSURANCE POLICIES
4.1.10 PERCENTAGE ANALYSIS FOR KIND OF INVESTMENT DOES THE RESPONDENT 32
PREFER
4.1.11 PERCENTAGE ANALYSIS FOR KNOWLEDGE AND UNDERSTANDING OF LIFE 33
INSURANCE INVESTMENTS OF RESPONDENT
4.1.12 PERCENTAGE ANALYSIS FOR RESPONDENTS WHO ARE PLANNING TO INVEST 34
IN LIFE INSURANCE PRODUCTS IN FUTURE
4.1.13 PERCENTAGE ANALYSIS FOR TYPE OF LIFE INSURANCE PRODUCTS 35

4.1.14 PERCENTAGE ANALYSIS FOR FEATURE OF THE POLICY ATTRACTED THE 36

RESPONDENT
4.1.15 PERCENTAGE ANALYSIS FOR FACTORS BASED ON THE IMPORTANCE AND 37
INFLUENCE ON INVESTMENT DECISION OF RESPONDENT
4.1.16 PERCENTAGE ANALYSIS FOR RESPONDENT OVERALL PERCEPTION ABOUT 42
LIFE INSURANCE IN INDIA
4.2 TOOLS USED FOR ANALYSIS 43
4.2.1 CHI-SQUARE TEST 43
4.2.2 CHI-SQUARE TEST 44
4.2.3 CHI-SQUARE TEST 45
4.3.1 ANOVA 46
4.4 WEIGHTED AVERAGE 47
5 SUMMARY 48
FINDINGS 49
SUGGESTIONS 53
CONCLUSION 54
 LIST OF TABLES

[Link] TITLE Page

no.
4.1.1 GENDER OF THE RESPONDENT 23

4.1.2 AGE OF THE RESPONDENT 24

4.1.3 EDUCATIONAL QUALIFICATION OF THE RESPONDENT 25

4.1.4 OCCUPATION OF THE RESPONDENT 26

4.1.5 ANNUAL INCOME OF THE RESPONDENT 27

4.1.6 MARITAL STATUS OF THE RESPONDENT 28

4.1.7 NO OF DEPENDENTS OF THE RESPONDENT 29

4.1.8 FACTORS INFLUENCED RESPONDENT DECISION TO INVEST IN LIFE INSURANCE 30

POLICIES
4.1.9 FACTORS INFLUENCED RESPONDENT DECISION NOT TO INVEST IN LIFE INSURANCE 31
POLICIES
4.1.10 KIND OF INVESTMENT DOES THE RESPONDENT PREFER 32

4.1.11 KNOWLEDGE AND UNDERSTANDING OF LIFE INSURANCE INVESTMENTS OF 33

RESPONDENT
4.1.12 RESPONDENTS WHO ARE PLANNING TO INVEST IN LIFE INSURANCE PRODUCTS IN 34
FUTURE
4.1.13 TYPE OF LIFE INSURANCE PRODUCTS 35

4.1.14 FEATURE OF THE POLICY ATTRACTED THE RESPONDENT 36

4.1.15 FACTORS BASED ON THE IMPORTANCE AND INFLUENCE ON INVESTMENT DECISION 37

OF RESPONDENT
4.1.16 RESPONDENT OVERALL PERCEPTION ABOUT LIFE INSURANCE IN INDIA 42

4.2.1 CHI-SQUARE ANALYSIS 43

4.2.2 CHI-SQUARE ANALYSIS 44

4.2.3 CHI-SQUARE ANALYSIS 45

4.3 ANOVA 46

4.4 WEIGHTED AVERAGE 47

 LIST OF CHARTS

[Link] TITLE Page

no.
4.1.1 GENDER OF THE RESPONDENT 23

4.1.2 AGE OF THE RESPONDENT 24

4.1.3 EDUCATIONAL QUALIFICATION OF THE RESPONDENT 25

4.1.4 OCCUPATION OF THE RESPONDENT 26

4.1.5 ANNUAL INCOME OF THE RESPONDENT 27

4.1.6 MARITAL STATUS OF THE RESPONDENT 28

4.1.7 NO OF DEPENDENTS OF THE RESPONDENT 29

4.1.8 FACTORS INFLUENCED RESPONDENT DECISION TO INVEST IN LIFE INSURANCE 30

POLICIES
4.1.9 FACTORS INFLUENCED RESPONDENT DECISION NOT TO INVEST IN LIFE INSURANCE 31
POLICIES
4.1.10 KIND OF INVESTMENT DOES THE RESPONDENT PREFER 32

4.1.11 KNOWLEDGE AND UNDERSTANDING OF LIFE INSURANCE INVESTMENTS OF 33

RESPONDENT
4.1.12 RESPONDENTS WHO ARE PLANNING TO INVEST IN LIFE INSURANCE PRODUCTS IN 34
FUTURE
4.1.13 TYPE OF LIFE INSURANCE PRODUCTS 35

4.1.14 FEATURE OF THE POLICY ATTRACTED THE RESPONDENT 36

4.1.15 FACTORS BASED ON THE IMPORTANCE AND INFLUENCE ON INVESTMENT DECISION 37

OF RESPONDENT
4.1.16 RESPONDENT OVERALL PERCEPTION ABOUT LIFE INSURANCE IN INDIA 42

4.2.1 CHI-SQUARE ANALYSIS 43

4.2.2 CHI-SQUARE ANALYSIS 44

4.2.3 CHI-SQUARE ANALYSIS 45

4.3 ANOVA 46

4.4 WEIGHTED AVERAGE 52

 1

CHAPTER 1
INTRODUCTION
1.1 INTRODCTION OF THE STUDY
Life insurance is a contract between an insurance policy holder and an insurer or assurer, where
the insurer promises to pay a designated beneficiary a sum of money upon the death of an
insured person. Depending on the contract, other events such as terminal illness or critical
illness can also trigger payment. The policyholder typically pays a premium, either regularly or
as one lump sum. The benefits may include other expenses, such as funeral expenses.

Life policies are legal contracts and the terms of each contract describe the limitations of the
insured events. Often, specific exclusions written into the contract limit the liability of the
insurer; common examples include claims relating to suicide, fraud, war, riot, and civil
commotion. Difficulties may arise where an event is not clearly defined, for example, the insured
knowingly incurred a risk by consenting to an experimental medical procedure or by taking
medication resulting in injury or death.

The insurance has become a part of human life. It is not restricted to life, marine or fire only, but
has spread over to almost every sphere of human activity. For example, a singer can insure his or
her throat, a dancer her legs and an actress her nails etc. So the scope of insurance is unlimited.
The significance of the insurance is not only limited to an individual or to a family alone but it
has spread over the entire nervous system of a business or say the country as a whole.

In today's dynamic and uncertain financial landscape, individuals are constantly seeking avenues
to secure their financial future and achieve their long-term goals. One such avenue that has
gained significant prominence is life insurance as an investment tool. Life insurance,
traditionally seen as a means of providing financial protection to beneficiaries in the event of the
policyholder's demise, has evolved into a multifaceted financial instrument that offers a
combination of protection and investment opportunities.

The perception of investors towards life insurance as an investment option has undergone
transformation in recent years. This study aims to delve into the intricacies of investor
 2

perceptions towards life insurance investments, shedding light on the factors that influence
decision-making, risk assessment, and overall attitudes toward this unique financial product.

Investors Perception:

Investor's perception refers to the choosing, purchasing and consumption of goods and services
for the satisfaction of their wants. A perception study seeks honest opinions and insights and
identifies areas of concern from investors so that the company could update its strategy and
tactics accordingly to better serve its customers, investors and key stakeholders and potentially
achieve better valuation in the capital markets.

1.2 INTRODUCTION TO THE INDUSTRY:-

Insurance industry in India has seen a major growth in past years along with an introduction of a
huge number of advanced products and services. This has led to a tough competition with
positive and healthy results. Insurance sector in India plays a dynamic role in the development of
its economy. It provides the opportunities for savings amongst the individuals, safeguards their
future and helps the insurance sector form a massive pool of funds which can be further utilized.
With the help of these funds, the insurance sector highly contributes to the development of
capital markets, thereby enhancing growth of infrastructure in India.

The insurance industry is a crucial sector of the economy that provides individuals, businesses,
and organizations with financial protection against various risks and uncertainties. It operates by
pooling funds from a large number of policyholders and using those funds to pay for covered
losses or damages. The primary goal of insurance is to mitigate the financial impact of
unexpected events, such as accidents, natural disasters, health issues, and more.

Insurance

Insurance is a legal agreement between an insurer (insurance company) and an insured

(individual), in which an insured receives financial protection from an insurer for the losses he
may suffer under specific circumstances. Under an insurance policy, the insured needs to pay
regular amount of premiums to the insurer. The insurer pays a predetermined sum assured to the
 3

insured if an unfortunate event occurs, such as death of the life insured, or damage to the insured
or his property.

COMPONENTS OF INSURANCE:-

1. Premium:

This is the financial consideration which makes the insurance agreement a legally binding
contract.

2. Policy Limit:

Policy limit applies to health and general insurance policies where compensation depends
on the amount of loss. The policy may limit the maximum compensation for certain types of
losses.
3. Deductible:
Deductible applies to general insurance and health insurance policies. A deductible is the
maximum amount of loss you will bear out of your pocket. The insurer will start paying only
when your losses (or expenses) rise above the deductible limit.

TYPES OF INSURANCE:-

 Life Insurance: Provides a payout to beneficiaries upon the policyholder's death.

 Health Insurance: Covers medical expenses and healthcare costs.
 Auto Insurance: Protects against financial losses due to vehicle accidents and damage.
 Property Insurance: Covers damage or loss to property (e.g., home, business) due to
events like fires, theft, or storms.
 Liability Insurance: Covers legal liabilities arising from injuries or property damage
caused to others.
 Business Insurance: Offers coverage for various risks faced by businesses, including
property damage, liability, and employee-related issues.
 4

Life Insurance
Life insurance is a contract between an individual (the policyholder) and an insurance company.
In exchange for regular premium payments, the insurance company agrees to provide a lump
sum payment, known as a death benefit, to the designated beneficiaries upon the death of the
insured person. This payment is meant to provide financial support to the beneficiaries in the
event of the policyholder's death, helping them cover expenses such as funeral costs, outstanding
debts, mortgage payments, education costs, and other financial needs.

TYPES OF LIFE INSURANCE:-

1. Term Life Insurance: This is the simplest and most affordable type of life insurance. It
provides coverage for a specific period (term), typically 10, 20, or 30 years. If the insured person
passes away during the term, the beneficiaries receive a death benefit. If the term expires and the
insured person is still alive, the coverage ends without any payout.

2. Whole Life Insurance: Also known as permanent life insurance, whole life insurance
provides coverage for the entire lifetime of the insured person. It combines a death benefit with a
savings or investment component known as cash value. Premiums for whole life insurance are
generally higher than term life insurance but remain level throughout the policy's duration.

3. Universal Life Insurance: This is another type of permanent life insurance that offers more
flexibility than whole life insurance. It allows the policyholder to adjust the premium payments
and death benefit within certain limits. Universal life insurance also accumulates cash value over
time, and the policyholder can use the cash value to pay premiums or take loans.

4. Variable Life Insurance: Similar to whole life insurance, variable life insurance provides a
death benefit and a cash value component. However, the cash value is invested in various sub-
accounts that function similarly to mutual funds. The policyholder can allocate their cash value
among these sub-accounts, which exposes them to market risk and the potential for higher
returns.
 5

5. Variable Universal Life Insurance: This type combines the flexibility of universal life
insurance with the investment options of variable life insurance. Policyholders can adjust
premiums, death benefits, and investment choices according to their needs and risk tolerance.
However, the investment component carries market risks.

6. Indexed Universal Life Insurance: This is a variation of universal life insurance where the
cash value growth is tied to the performance of a specific stock market index. It offers the
potential for higher returns than traditional universal life insurance while providing some
downside protection. However, there might be caps or limitations on the gains.

7. Guaranteed Issue Life Insurance: This type of insurance is typically designed for
individuals who might have difficulty obtaining coverage due to health issues. There are no
medical exams or health questions required, but premiums are often higher, and the death benefit
may be limited in the initial years.

8. Final Expense Insurance: Also known as burial insurance, this type of policy is designed to
cover the costs associated with a person's funeral and other final expenses. It's usually a smaller
policy and is often purchased by older individuals.

ADVANTAGES OF LIFE INSURANCE:-

1. Financial Protection for Dependents:

Life insurance ensures that your dependents, such as spouse, children, or aging parents, are
financially protected in the event of your untimely death. It helps replace lost income, cover
living expenses, and maintain their quality of life.

2. Debt and Loan Repayment:

Life insurance can be used to cover outstanding debts, such as mortgages, personal loans, and
credit card debts. This prevents your loved ones from inheriting your financial liabilities.
 6

3. Estate Planning:

Life insurance plays a crucial role in estate planning, especially for individuals with substantial
assets. It helps create liquidity to cover estate taxes and other settlement costs, ensuring that your
heirs receive their inheritance intact.

4. Business Continuity:

For business owners, life insurance can be used to provide funds for succession planning, buy-
sell agreements, and key person insurance. It ensures the business can continue operating
smoothly even in the absence of a key individual.

5. Supplement Retirement Income:

Certain types of life insurance, like permanent or whole life insurance, offer a cash value
component that grows over time. This cash value can be accessed during your lifetime and can
serve as a supplement to your retirement income.

6. Tax Benefits:

In many cases, the death benefit paid out from a life insurance policy is tax-free to the
beneficiary. Additionally, the cash value growth in certain types of life insurance policies can
accumulate tax-deferred, providing potential tax advantage.

7. Affordable Coverage:

Term life insurance, in particular, offers a relatively low-cost way to obtain a substantial amount
of coverage for a specific period, making it accessible for individuals on a budget.

8. Peace of Mind:

Having life insurance provides peace of mind, knowing that your loved ones will be taken care
of financially if something were to happen to you. This can alleviate stress and anxiety about the
future.
 7

9. Insurability:

Life insurance allows you to secure coverage while you're still young and healthy. As you age,
your health condition might change, making it harder or more expensive to obtain coverage.

10. Customization:

Life insurance policies can be tailored to your specific needs and goals. You can choose the
coverage amount, policy duration, and additional riders (such as critical illness or disability
riders) that align with your circumstances.

DISADVANTAGES OF LIFE INSURANCE:-

1. Cost:

Life insurance premiums can be expensive, especially for policies with larger coverage amounts
or specialized features. This can strain your budget, particularly if you're already dealing with
other financial responsibilities.

2. Complexity:

Life insurance policies can be complex and difficult to understand, especially for individuals
who are not well-versed in insurance terminology and concepts. This complexity can lead to
misunderstandings and make it challenging to select the right policy for your needs.

3. Limited Investment Returns:

While some life insurance policies offer a cash value component that can grow over time, the
investment returns are often lower compared to other investment options like stocks, bonds, or
mutual funds. If your goal is primarily to grow your wealth, there might be more efficient
investment avenues.
 8

4. Policy Lapses:

If you're unable to pay your premiums consistently, your life insurance policy might lapse,
causing you to lose the coverage and potentially any accumulated cash value. This can happen if
your financial situation changes unexpectedly.

5. Changing Needs:

Life insurance needs can change over time due to factors like marriage, children, home purchase,
or changes in financial goals. A policy that initially meets your needs might become inadequate
or unnecessary as your circumstances evolve.

6. Limited Flexibility:

Some life insurance policies have rigid terms and conditions, making it challenging to adjust
coverage or change beneficiaries without significant effort and sometimes additional costs.

7. Potential Over-Insurance:

It's possible to purchase more life insurance coverage than you actually need, resulting in higher
premiums. Conducting thorough needs analysis can help you avoid over-insuring yourself.

8. Medical Underwriting:

Many life insurance policies require medical underwriting, which means you need to undergo a
health examination. If you have pre-existing health conditions, this could lead to higher
premiums or even denial of coverage.

9. Cash Surrender Charges:

If you decide to surrender a cash value life insurance policy early, you might incur surrender
charges and forfeit a portion of the cash value you've accumulated.
 9

FACTORS THAT AFFECT LIFE INSURANCE PREMIUM:-

Now that you know what life insurance is and why you need it, find out the factors that can
affect the life insurance premium:

 Age
 Gender
 Health conditions
 Family health history
 Smoking and drinking alcohol
 Type of coverage
 Amount of coverage
 10

1.3 OBJECTIVES OF THE STUDY

1.3.1 PRIMARY OBJECTIVE:

To Study on Investors‟ Perception towards Life Insurance Investments

1.3.2 SECONDARY OBJECTIVE:

 To identify the demographic profile of the investors and their perception towards life
insurance investment.
 To find out the opinion regarding benefits provided by life insurance.
 To examine the factors influencing investment decision in life insurance policy.
 11

1.4 SCOPE FOR THE STUDY

 The study will focus on individual investors' perception towards life insurance
investments from different aspects.
 The study will explore a range of demographic segments including age, income,
education, gender, number of dependents, etc.
 12

1.5 NEED FOR THE STUDY

 The insurance industry is one of the fastest growing industries in the country.
 When compared with the developed foreign countries, the Indian life insurance industry
has achieved only a little because of the lack of insurance awareness.
 The study is basically intended to know the perception of investors towards life
insurance. And the factors influencing the investors to invest in life insurance.
 13

1.6 LIMITATIONS FOR THE STUDY

 The research period is for 1 month so there is a time constraint.

 Though the study provides insights about investor perception, it may not cover every
possible factor influencing investment decisions.
 14

CHAPTER-2
REVIEW OF LITERATURE

1. (Guan, Yusuf, & Ghani, 2020) Factors influencing customer purchase intention
towards insurance products. International Journal of Business and Management, the
study shows that product, price, place, promotion and attitude do influence the purchase
intention of insurance. Black box theory is applied in this study. This is a quantitative
study where data is collected using survey method. All items were using 5-points Likert
scale. 350 Sample is used in this survey using questionnaire developed using adoption
and adaptation of existing items. Using PLS-SEM data analysis method, this study found
that product is the most important influence on life insurance purchase decision. Attitude
his also found to mediate the relationship marketing stimuli and purchase behavior. This
study concludes that marketing mix which is product, price, place and promotion will
influence customer attitude and subsequently customer purchase intention. Hence,
insurance company should develop their marketing mix carefully in order to increase
sales. Future studies are recommended to investigate effect of image provided through
marketing/sales representatives on life insurance buying behavior.

2. (Mazhar & khan, 2019) a research was conducted on study of factors affecting
customer‟s preference towards investment in life insurance policies. The objectives of
the study were to exploring various factors that influence investment decisions of
customers in life insurance. The study was descriptive and exploratory in nature. It was
concluded that the consumer‟s decision to purchase insurance products from different
insurance companies can affect many factors, including age, gender and income were
interested in buying life insurance policies from other age groups, LIC was the most
popular brand among policy users of 150 respondents, 55% like LIC.

3. (Athma & Kumar, 2018) in the research paper titled “An explorative study of life
insurance purchase decision making: influence of product and non-product factors". The
empirical based study conducted on 200 sample size comprising of both rural and urban
 15

market. The various product and non-product related factors have been identified and
their impact on life insurance purchase decision-making has been analyzed. Based on
the survey analysis; urban market is more influenced with product based factors like risk
coverage, tax benefits, return etc. Whereas rural population is influenced with non-
product related factors such as: credibility of agent, company‟s reputation, trust,
customer services. Company goodwill and money back guarantee attracts many people
for life insurance.

4. (Deshmukh Sandeep & Jadhao Rajiv, 2018) the study was selected with an objective
to analyze the preferences of customers while life policy investment decision-making.
Various reasons to take insurance policies have been discussed in the paper. The data for
the study has been collected from both primary and secondary sources. The study area is
limited to Nagpur District of Maharashtra. The paper concludes with that most of the
respondents take insurance policies for “Savings” and “Wide risk coverage”.

5. (Sandeep Chaudhary, 2016) Insurance companies play an important role in the welfare
of human well-being by providing protection to millions of people against life risks such
as uncertain death or accident. Even the life insurance is fastest growing service sector in
India after Privatization and increase in FDI. Thus it has become essential to study the
buying pattern of the life insurance policies. The current study examines the various
factors that affect the consumer perception towards life insurance policy. Data was
collected with the help of structured questionnaire. The sample constituted of 100
respondents from Amritsar, Ludhiana and Chandigarh. The Statistical Technique used
for the analysis are descriptive and factor analysis. The main finding of the study
reflected that there are six factors i.e customized and timely services, better company
reputation, effective service quality, customer convenience, tangible benefits and healthy
customer client relationship that influence the consumer perception towards life
insurance policy.
 16

6. (Velmurugan, Selvan &Nazar, 2015) a study focused on an empirical on perception of

investors towards various investment avenues in Vellore city, Tamil Nadu. The
objectives of the study were to understand the effect of demographic factors on
investment, to identify investment decisions towards various investment avenues taken
by investors across gender and to ascertain the factors influencing the investor towards
selection/ order of preference of various investment The study concluded that
investment should be done in various investment avenues with the expectation of capital
appreciation and short and long term earnings. The basic idea behind investment of all
government, private, self-employed and retired person in this study was to utilize the
surplus money in favorable plans so that the money will be rolled back as well as it will
give high returns also.

7. (Yadav & Tiwari, 2014) the Study area is limited to Jabalpur district, of Madhya
Pradesh and sample size of 150 policyholders is taken and the sample have been selected
through a stratified and purposive sampling method. The study has been conducted to
find out factors influencing customer investment decision, impact of various
demographic factors, preferences of customers while taking the decision, and ranking of
factors responsible for the International Journal of Information Movement.

8. (Shamrao &Vibhute, 2013) conducted a survey in Kolhapur on 127 respondents to find

out the preference of customers towards insurance policy, the satisfaction level towards
ULIP plan and traditional plans and the factors influencing the investment decision. It
was found that LIC to be major insurance player and traditional plans being more
preferred than ULIP plans. Majority of holders think insurance to be purely protection
option followed by tax savings and pension scheme. Majority of holders take policies
from financial advisors and banks. Investor opinion of investment also depend upon
service quality, reputation, trust worthiness and future plans of company.

9. (Babita Yadav & Anshuja Tiwari, 2012) International Journal of Marketing, Financial
Services & Management Research, and Human life is a most important asset and life
insurance is the most important type of insurance which provides financial protection to
 17

a person and his family at the time of uncertain risks or damage. Life insurance provides
both safety and protection to individuals and also encourages savings among people.
LIC of India plays a vital role in the welfare of human well-being by providing
insurance to millions of people against life risks such as uncertain death or accident. The
present exploratory and descriptive based study was selected with an objective to
identify those factors which influence customers policy buying decision and also
analyze the preferences of customers while life policy investment decision-making.
Various insurance related factors have been discussed in the paper. The data for the
study has been collected from both primary and secondary sources. The study area is
limited to Jabalpur district, of Madhya Pradesh and sample size is 150 policyholders of
LIC and different private life insurers have been selected through a stratified and
purposive sampling method. Researcher has taken few hypothesis based on demographic
and insurance based preference factors and tested them with the help of various
statistical tools like chi-square, correlation and weighted average method. The analyzed
data has been presented in the form of table, bar graphs and pie-charts. LIC is the most
accepted and popular brand in life insurance, the market share of private insurers are
gradually increasing with people trust and better services offered by them are some of
the main findings of the study. Insurance companies should spread more awareness
about life insurance, reduction in premium amount and giving more attention on need
based innovative products are some of the suggestions provided by the researcher. The
paper concludes with that demographic factors of the people play a major and pivotal
role in deciding the purchase of life insurance policies.

10. (Uma, Selvanayaki & Shankar, 2011) Based their article titled “A Survey of Life
Insurance Customer‟s Awareness, Perception and Preferences” on the survey of 100
customers of life Insurance policies. It throws light on various aspects related to
customer‟s awareness, perception and preferences pertaining to life insurance. The
primary objectives of this survey were to find preferences of customer‟s towards various
life Insurance policies, factors influencing choice of life Insurance policy and awareness
about life Insurance brands.
 18

11. (Sahu, Jaiswal & Pandey, 2009) the study focused on buying behavior of consumers
towards life insurance policies. The objectives of the study were to develop and
standardize a measure to evaluate investment pattern in life insurance services, to
evaluate the factors underlying consumer perception towards investment in life
insurance policies, to compare the differences in consumer perception of male and
female consumers, to open new vistas for further researches. It was observed that
consumer‟s perception towards Life Insurance Policies was positive. It developed a
positive mind sets for their investment pattern, in insurance policies. Still some actions
are needed for developing insurance market. The major factors playing the role in
developing consumer‟s perception towards life insurance policies were consumer
loyalty, service quality, ease of procedures, satisfaction level, company image, and
company-client relationship.

12. (Athma & Kumar, 2007) in the research paper titled “an explorative study of life
insurance purchase decision making: influence of product and non-product factors". The
empirical based study conducted on 200 sample size comprising of both rural and urban
market. The various product and non-product related factors have been identified and
their impact on life insurance purchase decision-making has been analyzed. Based on
the survey analysis; urban market is more influenced with product based factors like risk
coverage, tax benefits, return etc. Whereas rural population is influenced with non-
product related factors such as: credibility of agent, company‟s reputation, trust,
customer services. Company goodwill and money back guarantee attracts many people
for life insurance.

13. (Debasish, 2004) the paper titled “Exploring Customer Preference for Life Insurance in
India-Factor Analysis Method”. He made analysis and explores the various factors
which customer takes into consideration while purchasing life policies and also
determine the extent to which these factors are considered by the customers.
 19

14. (Swati Jain) in their Article “A Study On Consumers‟ Perception Towards Insurance
As A Financial Planning Tool” Consumers prefer term deposits, money market funds,
mutual fund and metals (gold & silver) for their short-term investments. Mostly
preferred mode of investment for long term is Equity shares, bond & Debentures, life
insurance policy and real estate. Safety, high returns, liquidity & risk evaluation these
four are significant factors which helps the consumer in taking his or her decision of
buying a particular investment plan.
 20

CHAPTER 3

RESEARCH METHODOLOGY

Research methodology refers to the systematic and structured approach that researchers use to
plan, conduct, and evaluate their research studies. It encompasses the techniques, strategies,
procedures, and tools that researchers employ to gather and analyze information, draw
conclusions, and contribute to the advancement of knowledge in their respective fields. Research
methodology guides the entire research process, from identifying research questions or problems
to presenting the findings to the wider community. The chosen research methodology depends on
the nature of the study, the type of data required, and the scope of the research project.

3.1 RESEARCH DESIGN

Descriptive Research design has been used in this study. Descriptive research is a research
method used to try and determine the characteristics of a population or particular phenomenon.
Descriptive research is used to identify patterns in the characteristics of a group to essentially
establish everything you need to understand apart from why something has happened.

3.2 COLLECTION OF DATA

3.2.1 Primary data

Primary data refers to original data that is collected directly from its source for a specific
research purpose or investigation. It is data that has not been previously collected, processed, or
interpreted by anyone else. Primary data is gathered through methods such as surveys,
experiments, observations, interviews, or direct measurements. This type of data is valuable
because it provides researchers with firsthand and up-to-date information that is directly relevant
to their research objectives.

3.2.2 Secondary data

Secondary data refers to data that has been collected by someone else or for a purpose other than
your current research or analysis. Its data that has already been gathered, processed, and possibly
 21

analyzed by another individual, organization, or researcher. This data can come from a wide
variety of sources, including research studies, government reports, academic publications, market
research, and more.

The data for the study has been collected through Questionnaire which contains more than 20
questions has been used as instrument. The secondary data has been collected from insurance
journals, magazines and insurance website.

3.3 SAMPLING TECHNIQUE

Snowball sampling is a non-probability sampling method where new units are recruited by other
units to form part of the sample.

3.4 SAMPLE SIZE

A sample of 100 respondents is taken in this study and the required data has been collected.

3.5 TOOLS FOR ANALYSIS

3.5.1 PERCENTAGE ANALYSIS

Percentage analysis is used to determine the ratio of responses by the respondents. The
percentage can be found by dividing the value by the total value and then multifying the result by
100. The formula used to calculate the percentage is:

Percentage = Value x 100

Total Value

3.5.2 WEIGHTED AVERAGE

Weighted average analysis helps to find out the factors based on the investors‟ importance and
influence on their investment decisions. A weighted average is an average of factors when
certain factors count more than others or are of varying degrees of importance.

Weighted average = (∑wixi) / ∑wi

 22

3.5.3 CHI SQUARE

A chi-square test for independence is used to analyze the data as it compares two variables in a
contingency table to see if they are related. The chi-square formula is:

χ2 = ∑ (Oi – Ei) 2/Ei

Where;

Oi = observed value (actual value)

Ei = expected value.

3.5.4 ANOVA

Analysis of Variance (ANOVA) is a statistical formula used to compare variances across the
means (or average) of different groups. A range of scenarios use it to determine if there is any
difference between the means of different groups. The formula for Analysis of Variance is:

ANOVA coefficient, F= Mean sum of squares between the groups (MSB)/ Mean squares of
errors (MSE). Degrees of freedom of errors, N – k = df2 here, N is the total number of
observations throughout k groups.
 23

CHAPTER-4
DATA ANALYSIS AND INTERPRETATION
PERCENTAGE ANALYSIS

4.1.1 PERCENTAGE ANALYSIS FOR GENDER OF THE RESPONDENT

TABLE NO 4.1.1 GENDER OF THE RESPONDENT

Gender
Frequency Percent Valid Cumulative
Percent Percent
Male 60 60.0 60.0 60.0
Valid
Female 40 40.0 40.0 100.0

Total 100 100.0 100.0

INFERENCE
From the above table it shows that out of 100 respondents 60% are male and 40% are female.
 24

4.1.2 PERCENTAGE ANALYSIS FOR AGE OF THE RESPONDENT

TABLE NO 4.1.2 AGE OF THE RESPONDENT

Age
Frequency Percent Valid Cumulative
Percent Percent
Valid below 25 79 79.0 79.0 79.0
25-35 17 17.0 17.0 96.0
36-45 1 1.0 1.0 97.0
46-50 1 1.0 1.0 98.0
Above 50 2 2.0 2.0 100.0
Total 100 100.0 100.0

INFERENCE:

From the above table it shows that out of 100 respondents 79% are below
25years, 17% are 25 to 35years, 1% are 36 to 45 years, 1% are 46 to 50 years, 2% are above 50
years. .
 25

4.1.3 PERCENTAGE ANALYSIS FOR EDUCATIONAL BACKGROUND OF THE

RESPONDENT

TABLE NO 4.1.3 EDUCATIONAL BACKGROUND OF THE RESPONDENT

Educational background
Frequency Percent Valid Cumulative
Percent Percent
Val Bachelor‟s degree 34 34.0 34.0 34.0
id
Master‟s degree 64 64.0 64.0 98.0

Doctorate degree 2 2.0 2.0 100.0

Total 100 100.0 100.0

INFERENCE:
From the above table it shows that out of 100 respondents 64% are master‟s degree, 34% are
bachelor‟s degree, 2% are doctorate.
 26

4.1.4 PERCENTAGE ANALYSIS FOR OCCUPATION OF THE RESPONDENT

TABLE NO 4.1.4 OCCUPATION OF THE RESPONDENT

Occupation
Frequency Percent Valid Cumulati
Percent ve
Percent
Valid Professional 26 26.0 26.0 26.0

Self-employed 2 2.0 2.0 28.0

Student 67 67.0 67.0 95.0

Other (please 5 5.0 5.0 100.0

specify:
Total 100 100.0 100.0

INFERENCE:
From the above table it shows that out of 100 respondents 67% are student, 26% are
professional, 2% are self-employed, and 5% are others
 27

4.1.5 PERCENTAGE ANALYSIS FOR INCOME OF THE RESPONDENT

TABLE NO 4.1.5 INCOME OF THE RESPONDENT

Income
Frequency Percent Valid Percent Cumulative
Percent
Valid Less than 25000 64 64.0 64.0 64.0

25000-50000 13 13.0 13.0 77.0

50000-75000 4 4.0 4.0 81.0
75000-100000 2 2.0 2.0 83.0
Above 100000 17 17.0 17.0 100.0
Total 100 100.0 100.0

INFERENCE:

From the above table 64% are earning below 25000, 13% are earning 25000 to 50000, 4% are
earning 50000 to 750000, 2% are earning 75000 to 100000, 17% are earning above 100000.
 28

4.1.6 PERCENTAGE ANALYSIS FOR MARITAL STATUS OF THE RESPONDENT

TABLE NO 4.1.6 MARITAL STATUS OF THE RESPONDENT

Marital Status
Frequency Percent Valid Percent Cumulative
Percent
Valid Single 83 83.0 83.0 83.0

Married 17 17.0 17.0 100.0

Total 100 100.0 100.0

INFERENCE:
From the above table it shows that out of 100 respondent 83% is single, 17% are married.
 29

4.1.7 PERCENTAGE ANALYSIS FOR NO OF DEPENDENTS OF THE RESPONDENT

TABLE NO 4.1.7 NO OF DEPENDENTS OF THE RESPONDENT

No Of Dependents
Frequency Percent Valid Percent Cumulative
Percent
Valid 1-2 members 63 63.0 63.0 63.0
3-4 members 24 24.0 24.0 87.0
5-6 members 11 11.0 11.0 98.0
Above 6 2 2.0 2.0 100.0
members
Total 100 100.0 100.0

INFERENCE:
From the above table it shows that out of 100 respondents the 63% are 1 to 2 members, 24% are
3 to 4 members, 11% are 5 to 6 members and 2% are above 6 members dependents for the
investors.
 30

4.1.8 PERCENTAGE ANALYSIS FOR FACTORS INFLUENCED RESPONDENT

DECISION TO INVEST IN LIFE INSURANCE POLICIES

TABLE NO 4.1.9 FACTORS INFLUENCED RESPONDENT DECISION TO INVEST IN

LIFE INSURANCE POLICIES

If Yes, What factors influenced your decision to invest in life insurance policies?
(select all that apply)
Frequen Percent Valid Cumulative
cy Percent Percent
Valid Tax benefits 15 15.0 15.0 15.0
Protection for 17 17.0 17.0 32.0
family/dependent
Retirement planning 6 6.0 6.0 38.0
Long-term savings 11 11.0 11.0 49.0
Combination of above 51 51.0 51.0 100.0
Total 100 100.0 100.0

INFERENCE:

From the above table it was inferred that out of 100 respondents, 15% were selected tax benefits
influenced their decision, 17% are Protection for family/dependent, 6% are retirement planning,
11% are long term savings, 51% respondent selected combination of all.
 31

4.1.9 PERCENTAGE ANALYSIS FOR RESPONDENT DECISION NOT TO INVEST IN

LIFE INSURANCE POLICIES

TABLE NO 4.1.10 FACTORS INFLUENCED RESPONDENT DECISION NOT TO

INVEST IN LIFE INSURANCE POLICIES

Frequency Percent
Valid Lack of understanding about life 21 21.0
insurance
Perception of high premiums 8 8.0
Perception of low returns 12 12.0
Lack of trust in insurance companies 23 23.0
Unfavorable past experiences with life 6 6.0
insurance
Combination of above 30 30.0
Total 100 100.0

INFERENCE:
From the above table it shows that out of 100 respondents, 21% are lack of understanding about
life insurance, 12% are having perception of low returns, 8% are having perception of high
premiums, 23% are having lack of trust in insurance companies, 6% having Unfavorable past
experiences with life insurance, and 30% are combination of above.
 32

4.1.10 PERCENTAGE ANALYSIS FOR KIND OF INVESTMENT DOES THE

RESPONDENT PREFER

TABLE NO 4.1.11 KIND OF INVESTMENT DOES THE RESPONDENT PREFER

What kind of investment do you prefer?

Frequency Percent Valid Percent Cumulative
Percent
Valid Short term 20 20.0 20.0 20.0
Long term 35 35.0 35.0 55.0
Both 45 45.0 45.0 100.0
Total 100 100.0 100.0

INFERENCE:

From above table we can analyses that 45% respondents are interested in investing in both, 35%
respondents are interested in investing in long term investment and 20% respondents are
interested in investing in short term investment.
 33

4.1.11 PERCENTAGE ANALYSIS FOR KNOWLEDGE AND UNDERSTANDING OF

LIFE INSURANCE INVESTMENTS OF RESPONDENT

TABLE NO 4.1.12 KNOWLEDGE AND UNDERSTANDING OF LIFE INSURANCE

INVESTMENTS OF RESPONDENT

How would you rate your knowledge and understanding of life insurance investments?

Frequency Percent Valid Cumulative

Percent Percent
Valid Very knowledgeable 12 12.0 12.0 12.0
Somewhat knowledgeable 27 27.0 27.0 39.0
Neutral 53 53.0 53.0 92.0
Somewhat uninformed 5 5.0 5.0 97.0
Very uninformed 3 3.0 3.0 100.0
Total 100 100.0 100.0

INFERENCE:

From the above table it shows that out of 100 respondents, 12% are very knowledgeable about
the life insurance investment, 27% are somewhat knowledgeable, 53% are neutral, 5% are
somewhat uninformed, and 3% are very uninformed about the life insurance investments.
 34

4.1.12 PERCENTAGE ANALYSIS FOR RESPONDENTS WHO ARE PLANNING TO

INVEST IN LIFE INSURANCE PRODUCTS IN FUTURE

TABLE NO 4.1.13 RESPONDENTS WHO ARE PLANNING TO INVEST IN LIFE

INSURANCE PRODUCTS IN FUTURE

Are you planning to invest more in life insurance products in the future?

Frequency Percent Valid Cumulative

Percent Percent
Valid Yes, definitely 22 22.0 22.0 22.0
Yes, maybe 51 51.0 51.0 73.0
Undecided 16 16.0 16.0 89.0
No 11 11.0 11.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table it shows that out of 100 respondent, 22% are selected yes, definitely for
having plan to invest more in life insurance products, 51% are selected yes, maybe, 16% are
undecided, 11% of respondent does not have plan to invest more in life insurance products.
 35

4.1.13 PERCENTAGE ANALYSIS FOR TYPE OF LIFE INSURANCE PRODUCTS

TABLE NO 4.1.14 TYPE OF LIFE INSURANCE PRODUCTS

What type of life insurance products have you invested in? (select all that apply)
Frequenc Percent Valid Cumulative
y Percent Percent
Valid Term life insurance 49 49.0 49.0 49.0
Whole life insurance 16 16.0 16.0 65.0
Universal life insurance 8 8.0 8.0 73.0
Variable life insurance 3 3.0 3.0 76.0
combination of all 24 24.0 24.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table we can analyses that, 49% respondents are interested in investing in Term
life insurance, 16% respondents are interested in investing in Whole life insurance,8%
respondents are interested in investing in Universal life insurance, 3% respondents are interested
in investing in Variable life insurance, and other 24% are having interest in combination of all.
 36

4.1.14 PERCENTAGE ANALYSIS FOR FEATURE OF THE POLICY ATTRACTED

THE RESPONDENT

TABLE NO [Link] FEATURE OF THE POLICY ATTRACTED THE RESPONDENT

Which feature of the policy attracted you the most?

Frequency Percent Valid Cumulative

Percent Percent

Valid Money back guarantee 40 40.0 40.0 40.0

Company reputation 14 14.0 14.0 54.0
Risk coverage 30 30.0 30.0 84.0
Low premium 10 10.0 10.0 94.0
Other (please specify) 6 6.0 6.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table it shows that out of 100 respondents, 40% are attracted by money back
guarantee, 30% are risk coverage, 14%are attracted by company reputation, 10% are low
premium, and 6% are attracted by others.
 37

4.1.15 PERCENTAGE ANALYSIS FOR FACTORS BASED ON THE IMPORTANCE

AND INFLUENCE ON INVESTMENT DECISION OF RESPONDENT

a) ECONOMIC STABILITY
TABLE NO [Link] FACTORS BASED ON THE IMPORTANCE AND INFLUENCE ON
INVESTMENT DECISION OF RESPONDENT

Please rate the following factors based on their importance and influence on your investment
decisions. Use a scale of 1 to 5, where 1 indicates "not important at all" and 5 indicates "extremely
important." [Economic stability]
Frequency Percent Valid Percent Cumulative
Percent
Valid Not important at all 13 13.0 13.0 13.0
Somewhat important 32 32.0 32.0 45.0
Neutral 20 20.0 20.0 65.0
Important 21 21.0 21.0 86.0
Extremely important 14 14.0 14.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table we have analyses that 14% of respondent is thinking that economic
stability is extremely important, 21% are selected important, and 20% are selected neutral, 32%
respondent selected it is somewhat important, and 13% respondent thinking that economic
stability is not important at all.
 38

b) MARKET VOLATILITY

TABLE NO [Link] FACTORS BASED ON THE IMPORTANCE AND INFLUENCE ON

INVESTMENT DECISION OF RESPONDENT

Please rate the following factors based on their importance and influence on your investment
decisions. Use a scale of 1 to 5, where 1 indicates "not important at all" and 5 indicates
"extremely important." [Market volatility]
Frequency Percent Valid Cumulative
Percent Percent
Valid Not important at all 13 13.0 13.0 13.0
Somewhat important 28 28.0 28.0 41.0
Neutral 22 22.0 22.0 63.0
Important 30 30.0 30.0 93.0
Extremely important 7 7.0 7.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table we have analyses that 7% of respondent is thinking that market volatility is
extremely important, 30% are selected important, and 22% are selected neutral, 28% respondent
selected it is somewhat important, and 13% respondent thinking that is market volatility not
important at all.
 39

c) POLITICAL CLIMATE

TABLE NO [Link] FACTORS BASED ON THE IMPORTANCE AND INFLUENCE ON

INVESTMENT DECISION OF RESPONDENT

Please rate the following factors based on their importance and influence on your
investment decisions. Use a scale of 1 to 5, where 1 indicates "not important at all" and 5
indicates "extremely important." [Political climate]
Frequency Percent Valid Cumulative
Percent Percent
Valid Not important at all 13 13.0 13.0 13.0
Somewhat important 30 30.0 30.0 43.0
Neutral 31 31.0 31.0 74.0
Important 14 14.0 14.0 88.0
Extremely important 12 12.0 12.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table we have analyses that 12% of respondent is thinking that political climate
is extremely important, 14% are selected important, and 31% are selected neutral, 30%
respondent selected it is somewhat important, and 13% respondent thinking that is political
climate not important at all.
 40

d) INDUSTRY TRENDS

TABLE NO [Link] FACTORS BASED ON THE IMPORTANCE AND INFLUENCE ON

INVESTMENT DECISION OF RESPONDENT

Please rate the following factors based on their importance and influence on your investment
decisions. Use a scale of 1 to 5, where 1 indicates "not important at all" and 5 indicates
"extremely important." [Industry trends]
Frequency Percent Valid Cumulative
Percent Percent
Valid Not important at all 14 14.0 14.0 14.0
Somewhat important 28 28.0 28.0 42.0
Neutral 19 19.0 19.0 61.0
Important 29 29.0 29.0 90.0
Extremely important 10 10.0 10.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table we have analyses that 10% of respondent is thinking that industry trends is
extremely important, 29% are selected important, and 19% are selected neutral, 28% respondent
selected it is somewhat important, and 14% respondent thinking that industry trends is not
important at all.
 41

e) SOCIAL IMPACT

TABLE NO [Link] FACTORS BASED ON THE IMPORTANCE AND INFLUENCE

ON INVESTMENT DECISION OF RESPONDENT

Please rate the following factors based on their importance and influence on your
investment decisions. Use a scale of 1 to 5, where 1 indicates "not important at all" and 5
indicates "extremely important." [Social impact]
Frequency Percent Valid Cumulative
Percent Percent
Valid Not important at all 13 13.0 13.0 13.0
Somewhat important 26 26.0 26.0 39.0
Neutral 21 21.0 21.0 60.0
Important 19 19.0 19.0 79.0
Extremely important 21 21.0 21.0 100.0
Total 100 100.0 100.0

INFERENCE:
From the above table we have analyses that 21% of respondent is thinking that social impact is
extremely important, 19% are selected important, and 21% are selected neutral, 26% respondent
selected it is somewhat important, and 13% respondent thinking that social impact is not
important at all.
 42

4.1.16 PERCENTAGE ANALYSIS FOR RESPONDENT OVERALL PERCEPTION

ABOUT LIFE INSURANCE IN INDIA

TABLE NO 4.1.17 RESPONDENT OVERALL PERCEPTION ABOUT LIFE

INSURANCE IN INDIA

What is your overall perception about life insurance of India?

Frequency Percent Valid Cumulative
Percent Percent
Valid Positive 94 94.0 94.0 94.0

Negative 6 6.0 6.0 100.0

Total 100 100.0 100.0

INFERENCE:
From the chi-square test it shows that out of 100 respondent, 94% of respondent perception is
positive about life insurance and 6% are having negative perception of life insurance investment.
 43

4.2 TOOLS FOR ANALYSIS

4.2.1 CHI-SQUARE ANALYSIS

To find out the association between the investors education and perception about life insurance.
H0: There is no association between education and perception of life insurance.
H1: There is an association between the education and perception of life insurance.

Test Statistics

What is your overall

perception about life
Educational background insurance of India?
a
Chi-Square 57.680 77.440b
Df 2 1
Asymp. Sig. .000 .000
a. 0 cells (0.0%) have expected frequencies less than 5. The minimum expected
cell frequency is 33.3.

b. 0 cells (0.0%) have expected frequencies less than 5. The minimum expected
cell frequency is 50.0.

INFERENCE

From the chi-square test, we can find that the significant value is 0.000, which is less than table
value 0.05, so the Null hypothesis is rejected and Alternative hypothesis is accepted.
Therefore there is an association between the educational background and perception of life
insurance.
 44

4.2.2 CHI-SQUARE ANALYSIS

To find out the association between the investors gender and perception about life insurance.
H0: There is no association between gender and perception of life insurance.
H1: There is an association between the gender and perception of life insurance.

Test Statistics

What is your overall

perception about life
Gender insurance of India?
Chi-Square 4.000a 77.440a

Df 1 1
Asymp. Sig. .046 .000

a. 0 cells (0.0%) have expected frequencies less than 5. The minimum

expected cell frequency is 50.0.

INFERENCE
From the chi-square test, we can find that the significant value is 0.046, which is less than table
value 0.05, so the Null hypothesis is rejected and Alternative hypothesis is accepted.
Therefore there is an association between the gender and perception of life insurance.
 45

4.2.3 CHI-SQUARE ANALYSIS

To find out the association between the investors marital status and investors who are planning to
invest more in life insurance products in future.
H0: There is no association between the investor‟s marital status and investors who are planning
to invest more in life insurance products in future.
H1: There is an association between the investor‟s marital status and investors who are planning
to invest more in life insurance products in future.

Test Statistics

Are you planning to

invest more in life
insurance products in the
Marital Status future?
a
Chi-Square 43.560 38.480b
Df 1 3
Asymp. Sig. .000 .000
a. 0 cells (0.0%) have expected frequencies less than 5. The minimum
expected cell frequency is 50.0.

b. 0 cells (0.0%) have expected frequencies less than 5. The minimum

expected cell frequency is 25.0.

INFERENCE

From the chi-square test, we can find that the significant value is 0.000, which is less than table
value 0.05, so the Null hypothesis is rejected and Alternative hypothesis is accepted.
Therefore there is a significance difference between the investor‟s marital status and investors
who are planning to invest more in life insurance products in future.
 46

4.3.1 ANOVA
The ANOVA was conducted to identify the significance difference between income and kind of
investment investor prefer.
H0: There is no significance difference between income and kind of investment investor prefer.
H1: There is an significance difference between income and kind of investment investor prefer

ANOVA

What kind of investment do you prefer?

Sum of
Squares df Mean Square F Sig.
Between Groups 7.460 4 1.865 3.455 .011

Within Groups 51.290 95 .540

Total 58.750 99

INFERENCE
The ANOVA was conducted to identify influence of income and kind of investment investor
[Link] consists of different income group members. The significant value p=0.011 so, the Null
hypothesis is rejected and Alternative hypothesis is accepted. Therefore there is significant
difference between income and kind of investment investor prefer. The result suggests that the
income of the person influence the kind of investment investor will prefer.
 47

4.4 WEIGHTED AVERAGE

To know about the factors based on the investors‟ importance and influence on their investment
decisions.
TABLE No 4.4 WEIGHTED AVERAGE FOR FACTORS BASED ON THE INVESTORS’
IMPORTANCE AND INFLUENCE ON THEIR INVESTMENT DECISIONS.

Factors Economic X1* Market X2* Political X3* Industry X4* Social X5*
stability w volatilit w climate w trends w impact w
y
Weights W X1 X2 X3 X4 X5
Not 1 13 13 13 13 13 13 14 14 13 13
important
at all
Somewhat 2 32 64 28 56 30 60 28 56 26 52
important
Neutral 3 20 60 22 66 31 93 19 57 21 63

Important 4 21 84 30 120 14 56 29 116 19 76

Extremely 5 14 70 7 35 12 60 10 50 21 105
important
Total 15 100 291 100 290 100 282 100 293 100 309
Y=sum(x* 19.4 19.3 18.8 19.5 20.6
w/sum(w)
Rank 3 4 5 2 1

INFERENCE
 Social impact got more weightage among other factors as 20.6 and it is considered as the
important and influence on their investment decisions. So it is ranked as highest.
 Among the influencing factor industry trends, economic stability, market volatility,
political climate has been ranked as 2nd, 3rd, 4th&5th respectively.
 48

CHAPTER 5
FINDINGS AND SUGGESSTIONS

5.1 FINDINGS

5.1.1 PERCENTAGE ANALYSIS

 According to the study, out of 100 respondents 60% are male respondents and 40% are
female respondents.
 According to the study, out of 100 respondents 79% are below 25years, 17% are 25 to
35years, 1% are 36 to 45 years, 1% is 46 to 50 years, 2% are above 50 years. .
 According to the study, out of 100 respondents 64% are master‟s degree, 34% are
bachelor‟s degree, 2% are doctorate.
 According to the study, out of 100 respondents 67% are student, 26% are professional,
2% are self-employed, and 5% are others
 According to the study, 64% are earning below 25000, 13% are earning 25000 to 50000,
4% are earning 50000 to 750000, 2% are earning 75000 to 100000, 17% are earning
above 100000.
 According to the study, out of 100 respondent 83% is single, 17% are married.
 According to the study, out of 100 respondents the 63% are 1 to 2 members, 24% are 3 to
4 members, 11% are 5 to 6 members and 2% are above 6 members‟ dependents for the
investors.
 According to the study, out of 100 respondents, 15% were selected tax benefits
influenced their decision, 17% are Protection for family/dependent, 6% are retirement
planning, 11% are long term savings, 51% respondent selected combination of all.
 According to the study, out of 100 respondents, 21% are lack of understanding about life
insurance, 12% are having perception of low returns, 8% are having perception of high
premiums, 23% are having lack of trust in insurance companies, 6% having Unfavorable
past experiences with life insurance, and 30% are combination of above.
 49

 According to the study, we can analyses that 45% respondents are interested in investing
in both, 35% respondents are interested in investing in long term investment and 20%
respondents are interested in investing in short term investment.
 According to the study, out of 100 respondents, 12% are very knowledgeable about the
life insurance investment, 27% are somewhat knowledgeable, 53% are neutral, 5% are
somewhat uninformed, and 3% are very uninformed about the life insurance investments.
 According to the study, out of 100 respondent, 22% are selected yes, definitely for having
plan to invest more in life insurance products, 51% are selected yes, maybe, 16% are
undecided, 11% of respondent does not have plan to invest more in life insurance
products.
 According to the study, 49% respondents are interested in investing in Term life
insurance, 16% respondents are interested in investing in Whole life insurance,8%
respondents are interested in investing in Universal life insurance, 3% respondents are
interested in investing in Variable life insurance, and other 24% are having interest in
combination of all.
 According to the study, out of 100 respondents, 40% are attracted by money back
guarantee, 30% are risk coverage, 14%are attracted by company reputation, 10% are low
premium, and 6% are attracted by others.
 According to the study,14% of respondent is thinking that economic stability is extremely
important, 21% are selected important, and 20% are selected neutral, 32% respondent
selected it is somewhat important, and 13% respondent thinking that economic stability is
not important at all.
 According to the study, 7% of respondent is thinking that market volatility is extremely
important, 30% are selected important, and 22% are selected neutral, 28% respondent
selected it is somewhat important, and 13% respondent thinking that is market volatility
not important at all.
 According to the study, 12% of respondent is thinking that political climate is extremely
important, 14% are selected important, and 31% are selected neutral, 30% respondent
selected it is somewhat important, and 13% respondent thinking that is political climate
not important at all.
 50

 According to the study, 10% of respondent is thinking that industry trends is extremely
important, 29% are selected important, and 19% are selected neutral, 28% respondent
selected it is somewhat important, and 14% respondent thinking that industry trends is
not important at all.
 According to the study, 21% of respondent is thinking that social impact is extremely
important, 19% are selected important, and 21% are selected neutral, 26% respondent
selected it is somewhat important, and 13% respondent thinking that social impact is not
important at all.
 According to the study, out of 100 respondents, 94% of respondent perception is positive
about life insurance and 6% are having negative perception of life insurance investment.
 According to the study, from the chi-square analysis we find that the significant value is
0.000, which is less than table value 0.05, so the Null hypothesis is rejected and
Alternative hypothesis is accepted. Therefore there is an association between the
education and perception of life insurance.
 According to the study, from the chi-square analysis we can find that the significant value
is 0.046, which is less than table value 0.05, so the Null hypothesis is rejected and
Alternative hypothesis is accepted. Therefore there is an association between the gender
and perception of life insurance.
 According to the study, from the chi-square analysis we can find that the significant value
is 0.000, which is less than table value 0.05, so the Null hypothesis is rejected and
Alternative hypothesis is accepted. Therefore there is a significance difference between
the investor‟s marital status and investors who are planning to invest more in life
insurance products in future.
 According to the study, from the ANOVA test we find that the significant value p=0.011
so, the Null hypothesis is rejected and Alternative hypothesis is accepted. Therefore there
is significant difference between income and kind of investment investor prefer. The
result suggests that the income of the person influence the kind of investment investor
will prefer.
 According to the study, Social impact got more weightage among other factors as 20.6
and it is considered as the important and influence on their investment decisions. So it is
 51

ranked as highest. Among the influencing factor industry trends, economic stability,
market volatility, political climate has been ranked as 2nd, 3rd, 4th&5th respectively.
 52

SUGGESTION

The insurance sector has a vast potential not only because incomes are increasing and assets are
expanding but also because the volatility in the system is increasing. In a sense, we are living in a
more risky world. Trade is becoming increasingly global. Technologies are changing and getting
replaced at a faster rate. In this more uncertain world, for which enough evidence is available in
the recent period, insurance will have an important role to play in reducing the risk burden
individuals and businesses have to bear. The suggestion for this study is to introduce the scheme
that is suitable to all age group and also it should satisfy their needs based on their level because
in this study the parameter gender, educational background, marital status, are influencing the
investor perception towards life insurance investments. The knowledge about the life insurance
is neutral for most of the respondents the life insurance industry must improve their promotion
and also they want to give the financial advice to the investors. In the research study 94% of the
respondents having positive opinion regarding life insurance investment, but they don‟t have any
proper knowledge about life insurance. And also the 75% of the population is living dangerously
without having life insurance in India. The life insurance industry should build awareness about
life insurance.
 53

CONCLUSION

In present Indian market, the investment habits of consumers are changing very frequently. The
individuals have their own perception towards various types of investment plans. The study of
this research work was focused over investor perception on investment towards life Insurance.
From this study the results conclude that the one‟s age, educational qualification, occupation,
marital status is influencing their perception towards life insurance investment. In this research
work most of the respondents have positive perception about life insurance of India. Company
image is highly important criteria that investors considered before taking up a life insurance.
This is mainly because people expect safety and secure for their money which they invest,
followed by the factor premium which we pay to the insurer and then bonus and interest paid by
the company, service, etc.
 54

BIBILIOGRAPHY

 Guan, L. P., Yusuf, D. H. M., & Ghani, M. R. A. (2020). Factors influencing customer
purchase intention towards insurance products. International Journal of Business and
Management, 4(5), 70-79.
 Bajpai, S., Mazhar, S. S., Khan, F. S., Prakash, G., & Singh, A. (2022). Empirical study
on customer satisfaction towards services of Life Insurance Corporation at
Lucknow. Journal of Information and Optimization Sciences, 43(7), 1871-1883.
 Athma, P., & Kumar, R. (2007). An explorative study of life insurance purchase decision
making: Influence of product and non-product factors. ICFAI Journal of Risk &
Insurance, 4(4), 40-48.
 Deshmukh, S., & Jadhao, R. (2018). Customers‟ perception for taking life insurance: A
critical analysis of life insurance sector in Nagpur. SAARJ Journal on Banking &
Insurance Research, 7(3), 4-9.
 Chaudhary, S., & Kaur, J. (2016). Consumer perception regarding life insurance policies:
A factor analytical approach. Pacific Business Review International, 9(6), 52-61.
 Datta, R. N. (2021). INVESTORS PERCEPTION TOWARDS VARIOUS
INVESTMENT AVENUES: AN EMPIRICAL STUDY BASED ON SOUTH 24
PARGANAS DISTRICT OF WEST BENGAL. CLEAR International Journal of
Research in Commerce & Management, 12(1).
 Balani, K. A Perception of Investors regarding Investment in Life insurance with special
reference to Rajkot City.
 Sahu, P., Jaiswal, G., & Pandey, V. K. (2009). A study of buying behavior of
consumers towards life insurance policies. Aima Journal of Management &
Research, 3(3), 1-10.
 Bhavani, G., & Shetty, K. (2017). Impact of demographics and perceptions of investors
on investment avenues. SSRN.
 Yadav, B., & Tiwari, A. (2012). A study on factors affecting customer‟s investment
towards life insurance policies. International Journal of Marketing, Financial Services
& Management Research, 1(7), 106-123.
 55

 Praveen Sahu, Gaurav Jaiswal, Vijay Kumar Pandey, 2009/8 Aima Journal of
Management & Research, A Study Of Buying Behavior Of Consumers Towards Life
Insurance Policies.
 [Link]
does-it-work
 [Link]
 [Link]
 [Link]
 [Link]
insurance/life-insurance/31538773
 [Link]
e_Life_Insurance_Industry
 [Link]
 [Link]
 56

ANNEXURE

1. Name
2. Email Id
3. Gender
 Male
 Female
 Others
4. Age
 Below25
 25-35
 36-45
 46-50
 Above 50
5. Education Background
 Non –matriculate
 High School
 Bachelor‟s degree
 Master‟s degree
 Doctorate degree
6. Occupation
 Professional
 Self-employed
 Student
 Retired
 Other (please specify: ____________)
7. Annual Income
 Less than 25000
 25000-50000
 50000-75000
 57

 75000-100000w
 Above 100000
8. Marital Status
 Single
 Married
9. No Of Dependents
 1-2 members
 3-4 members
 Above 5 members
10. If yes, what factors influenced your decision to invest in life insurance policies? (Select
all that apply)
 Tax benefits
 Protection for family/dependent
 Retirement planning
 Long-term savings
 Recommendation from financial advisor
 Other (Please specify: ________)
11. If no, what are the reasons for not investing in life insurance policies? (Select all that
apply)
 Lack of understanding about life insurance
 Perception of high premiums
 Perception of low returns
 Lack of trust in insurance companies
 Unfavorable past experiences with life insurance
 Other (Please specify: ________)
12. What kind of investment do you prefer?
 Short term
 Long term
 Both
13. How would you rate your knowledge and understanding of life insurance investments?
 58

 Very knowledgeable
 Somewhat knowledgeable
 Neutral
 Somewhat uninformed
 Very uninformed
14. Are you planning to invest more in life insurance products in the future?
 Yes, definitely
 Yes, maybe
 Undecided
 No
15. What type of life insurance products have you invested in? (Select all that apply)
 Term life insurance
 Whole life insurance
 Universal life insurance
 Variable life insurance
 Other (please specify)
16. Which feature of the policy attracted you the most?
 Money back guarantee
 Company reputation
 Risk coverage
 Low premium
 Other (please specify)
17. Please rate the following factors based on their importance and influence on your
investment decisions. Use a scale of 1 to 5, where 1 indicates "Not important at all" and 5
indicates "Extremely important."
1) Economic Stability:
1- Not important at all
2-Somewhat important
3-Neutral
4-Important
 59

5-Extremely important
2) Market Volatility:
1-Not important at all
2 - Somewhat important
3 - Neutral
4 - Important
5 - Extremely important
3. Political Climate:
1 - Not important at all
2 - Somewhat important
3 - Neutral
4 - Important
5 - Extremely important
4. Industry Trends:
1 - Not important at all
2 - Somewhat important
3 - Neutral
4 - Important
5 - Extremely important
5. Social Impact:
1 - Not important at all
2 - Somewhat important
3 - Neutral
4 - Important
5 - Extremely important

18. What is your overall perception about life insurance of India?

 Positive
 Negative