THE COMPLEXITY OF THE INSURANCE PURCHASE DECISION MAKING PROCESS

Reaping the benefits of the rapid growth of the insurance markets, in particular in Asia, calls for improving the understanding of their respective consumers' expectations and behaviours. This paper presents an approach for modelling and analysing how consumers form their purchase decision for insurance services. Building upon fragmented insurance consumer behaviour works, we propose a model that consolidates and expands the current state-of-the-art. This model includes various consumers' characteristics such as life quality, exposure to risks, insurance culture and family nest filters, consumers' "intelligence", perception of need for security, need for insurance and affordability. Combined together, they model the consumers' inclination towards purchasing insurance. This is followed by a price-quality trade-off filter that leads to the specific product purchase decision; moreover, we propose a scheme that reflects the complexity of the selection process. Experiments illustrate how the proposed model can be used for evaluating the impact of the various parameters. The results show that the relation between the income level and the purchase intention is not linear; that when an insurance service is perceived as affordable, consumers are inclined to buy it and pay less attention to its quality; that consumers tend to behave similarly, proportionally to their income levels; and that the decoy effect influences the price-quality trade-off.