Factors affecting selection of life insurance companies in nepal

Abstract

This study assessed the factors influencing the selection of life insurance companies in Nepal, addressing a critical gap in understanding consumer behavior within the country‘s evolving insurance market. Utilizing a descriptive and causal research design, the study explores the impact of product and premium, service quality, closeness, technology, agent behavior, and brand image on consumer decision-making. Primary data were collected from 384 respondents through structured questionnaires employing a five-point Likert scale, with convenience sampling applied due to practical constraints. Descriptive analysis, correlation, and regression analysis were conducted to assess the significance and interrelationships of these factors. The findings reveal that service quality (r = 0.819, β = 0.605) and closeness (r = 0.762, β = 0.391) are the most influential determinants, followed by technology (β = 0.213), with all factors showing statistical significance (p < 0.05). Strong inter-variable correlations, notably between closeness and technology (r = 0.842), indicate a synergistic effect, suggesting that improvements in one factor enhance others. These results imply that insurance companies should prioritize exceptional service, foster personal connections, and leverage digital innovations to meet consumer expectations while maintaining competitive pricing and strong brand reputation. The study provides actionable insights for insurers to enhance market competitiveness and for policymakers to promote financial literacy and regulatory support, fostering a consumercentric insurance sector in Nepal. Despite limitations such as convenience sampling and a sample size of 384, the findings offer a robust foundation for future research and strategic development in Nepal‘s life insurance industry.

Keywords: Agent behavior, brand image, closeness, service quality, technology