ABSTRACT

This study investigates the factors influencing households’ consumption of life insurance in Buea, Cameroon, focusing on the various insurance companies operating in the region. Life insurance is a vital financial product that provides financial security and peace of mind to individuals and their families. Understanding the factors that affect its consumption is essential for insurance companies, policymakers, and stakeholders aiming to enhance insurance penetration and promote financial literacy in Cameroon.

The research employs a mixed-methods approach, combining quantitative surveys and qualitative interviews to gather comprehensive data. A structured questionnaire was distributed to a sample of households in Buea to assess their awareness, attitudes, and consumption patterns regarding life insurance. Additionally, in-depth interviews with representatives from various insurance companies were conducted to gain insights into the marketing strategies, challenges, and consumer perceptions in the life insurance market.

The findings reveal several key factors influencing the consumption of life insurance among households in Buea. Firstly, awareness and understanding of life insurance products were found to be crucial determinants. Many respondents indicated a lack of knowledge about the benefits and features of life insurance, which significantly impacted their purchasing decisions. Educational campaigns and community outreach initiatives are essential to increase awareness and comprehension of life insurance.

Secondly, socioeconomic factors such as income level, education, and occupation play a significant role in influencing insurance consumption. Higher income households were more likely to invest in life insurance compared to lower-income households. Additionally, individuals with higher education levels demonstrated a greater understanding of financial products, leading to increased insurance uptake.

Cultural beliefs and perceptions also emerged as significant factors affecting life insurance consumption. In some cases, traditional beliefs regarding death and financial planning discouraged individuals from purchasing life insurance. Misconceptions about life insurance as an unnecessary expense further hindered its acceptance. Insurance companies must address these cultural barriers through targeted marketing strategies that resonate with local values and beliefs.

The trustworthiness and reputation of insurance companies were identified as critical factors in influencing household decisions to purchase life insurance. Respondents expressed concerns about the reliability of insurers and their ability to honor claims. Building trust through transparent practices, effective communication, and customer service can enhance consumer confidence in life insurance products.

Additionally, policy features such as premium costs, coverage amounts, and payment flexibility significantly impacted consumption patterns. Households preferred life insurance products that offered affordable premiums and flexible payment options. Insurance companies should consider developing tailored products that align with the financial capabilities and preferences of different consumer segments.

In conclusion, the study highlights the multifaceted factors affecting households’ consumption of life insurance in Buea, Cameroon. By addressing issues of awareness, socioeconomic barriers, cultural perceptions, trust, and policy features, insurance companies can enhance their market strategies and promote greater acceptance of life insurance among households. This approach will ultimately contribute to increased financial security and improved well-being for families in Cameroon.

Keywords: life insurance, household consumption, Buea, Cameroon, socioeconomic factors, cultural beliefs, insurance companies.