Explore Investment in Women's Insurance Policies Using Cluster Analysis

Abstract

Purpose: The aim of the study is to analyse the preference factor of selective exclusive women’s insurance policies based on the overall product features for future investment.

Theoretical framework: By 2030, in India, the annual women’s life insurance market is predicted to be approximately 2 to 3 times of the current market. The potential income growth of Indian women in the future will convert them into a huge investors in insurance industry.

Design / methodology / approach: Stratified random sampling technique was applied to select the women policyholders of private and public Life Insurance industry in Chennai. Out of the entire sample of 1046 women policy holders, 505 from LIC and private insurance sector, and another 541 women policyholders have invested in ‘exclusive women’s insurance policies. The study focused only to the major five insurance policies like LIC Jeevan Bharathi-I Plan, SBI Life Smart Women Advantage Plan, Tata-AIG's Wellsurance Woman, HDFC Life Smart Women ULIP and Bajaj Allianz Women Specific Critical Illness Insurance.

Findings: only two third of the women respondents know about the exclusive women’s insurance  policies,  selected demographics factors  age, marital status, education, and occupation, had a significant relationship with women’s preference of purchasing life insurance. Unmarried, highly educated, young Professional women desire to invest in high-risk high-return insurance policies;

Research, Practical & Social implications: Insurers should concentrate on income protection insurance for women with policies and annuity plans guaranteeing fixed income streams of regular income. Urban working women’s prominent insurance investment criteria is to avail tax benefits, hence the insurers must provide the details of tax planning and appropriate tax savings for their secure future. Insurers must devise their offerings, considering the variations in the Income Tax provisions and rebates available under Income Tax Act.

Originality/value: The changing demographics and social changes, requires a better understanding of the preference of women towards life insurance, which would certainly facilitate enhanced market penetration in the women segment, but there exists a dearth of knowledge in this regard. Thus, this research is oriented towards the study of the factors which influences the women’s Life insurance purchase. While there have been several approaches to study the consumer behaviour, there is no evidence of a study which explains the attitude, influential factors and preference of women towards exclusive women policies.