Saving and life insurance

Abstract

This research has been mainly divided into two parts. The first part tackles the issue of saving and its importance towards the economy and individuals. The research sought to determine what are the rationales behind how much people save, and where they save. The second part of the study focused on life insurance as a saving method. Life insurance can offer different saving plans which can satisfy individual‟s need for saving and financial protection, while it can also positively contribute towards a country‟s economy (Dickinson 2000). The research aimed to determine; whether people purchased life insurance saving plans, for which reasons they purchased them, whether they trust life insurance companies and what determinants affect the purchasing of life insurance. Results show that people acknowledge the importance of saving and the need for financial protection (Swiss Re 2010); with peace of mind, leisure, housing and retirement being the main reasons for which people save. On the other hand, when it comes to the reasons for which people purchase life insurance, results have shown that life insurance is mainly associated with retirement, and the significant majority who purchase life insurance, do so with the intention to be able to sustain themselves once they retire (Zietz 2003). Results also suggest that there is low trust and awareness in life insurance companies, and as a result, these have a negative effect on the purchasing of life insurance. The research has managed to produce numerous results and valuable data from the primary and secondary research conducted. These results had to be narrowed down and focus was given to particular areas, which were regarded to be the most relevant for the research question. Ultimately, the research concludes by suggesting how both awareness and purchasing of life insurance could be increased, as a saving method.