Factors Affecting Consumers' Comprehensive Vehicle Insurance Policy Purchasing Behavior
Abstract
Research Originality: With increasing vehicle values in Türkiye and high insurance costs, consumers' vehicle insurance purchasing preferences emerge as a dilemma. The study examines consumers' insurance purchasing behavior in this dilemma's context of risk and overconfidence tendencies.
Research Objectives: This study aims to reveal the effects of individual characteristics, attitude toward risk, and overconfidence tendencies on comprehensive vehicle insurance policy purchasing behavior.
Research Methods: A questionnaire was administered to 428 selected vehicle owners in Turkey, and the questionnaire results were analyzed using the binary logit model.
Empirical Results: The study found that gender, education level, income level, market value of the vehicle, attitude towards risk, and self-confidence level have statistically significant effects on comprehensive vehicle insurance policy purchase decisions.
Implications: The relationship between risk-taking behavior, overconfidence, and insurance purchasing behavior requires further discussion. Government policies that increase insurance awareness are recommended to weaken this relationship.
JEL Classification: D12, G22, C25
How to Cite:
Kutlu, M., Sumer Adin, S., Mola, H., & Şahin Kutlu, S. (2024). Analysis of Factors Affecting Consumers' Comprehensive Vehicle Insurance Policy Purchasing Behavior. Etikonomi, 3(2), 539 – 554. https://doi.org/10.15408/etk.v23i2.37807.
Keywords
References
Agbo, I. U., & Agbaji, B. C. (2019). Effect of Motor Insurance Claims Settlement on Insurance Penetration in Nigeria. International Journal of Research in Management Fields, 3(4), 1-11. https://doi.org/10.26808/rs.rmf.v3i4.01.
Akan, M. (2012). Determinants of Company Choice of Motor Insurance Customers in Turkey. Sigorta Araştırmaları Dergisi, 9, 25-46.
Akkurt, E., & Okur, A. (2022). Kasko Sigortası Üretimi Yapan Şirketlerin 2017–2021 Yılları Arası VZA ve TOPSIS Yöntemleriyle Etkinlik Analizi. Bankacılık ve Finansal Araştırmalar Dergisi, 9(2), 98-113. https://doi.org/10.55026/jobaf.1132067.
Alex, S., & Aithal, P. S. (2022). Factors Influencing the Buying Behavior of Motor Insurance Policyholders - A Study of Kottarakara Municipality. International Journal of Early Childhood Special Education, 14(3), 469-472.
Balkı, A., & Göksu, S. (2022). Otomobil Sigorta Sektöründeki Regülasyonların Sektöre Etkisi. Turkuaz Uluslararası Sosyo-Ekonomik Stratejik Araştırmalar Dergisi, 4(1), 25-38.
Baltacı, A. (2020). Doğum Teminatı Sigortası Tercihinde Hamilelikte Risk Algısının Etkisi: Kadın Tüketiciler Üzerine Bir Araştırma. Bankacılık ve Sigortacılık Araştırmaları Dergisi, 14, 26-43.
Berry, W.D., DeMeritt, J.H.R. and Esarey, J. (2010), Testing for Interaction in Binary Logit and Probit Models: Is a Product Term Essential? American Journal of Political Science, 54, 248-266. https://doi.org/10.1111/j.1540-5907.2009.00429.x.
Boyer, M. M., De Donder, P., Fluet, C., Leroux, M.-L., & Michaud, P.-C. (2017). Long-Term Care Insurance: Knowledge Barriers, Risk Perception and Adverse Selection. NBER Working Paper 23918.
Bregu, K. (2022). The Effect of Overconfidence on Insurance Demand. The Geneva Risk and Insurance Review, 47(2), 298–326. https://doi.org/10.1057/s10713-021-00064-5.
Dansu, S. F., Abass, O. A., & Oyetayo, Y. A. P. (2018). Factors Influencing the Choıce of Third Party Liability Motor Insurance Among Academic Staff in Lagos State Nigeria. LASU Journal of Employment Relations & Human Resource Management, 1(1), 210-220.
Demiray Erol, E., & Alma, D. (2016). Kasko Sigorta Tercihini Etkileyen Faktörlerin Belirlenmesi: Celal Bayar Üniversitesi Personeline Uygulama. Sosyal Ekonomik Araştırmalar Dergisi, 16(32), 148-167.
Dragos, C. M., & Dragos, S. L. (2017). Estimating Consumers’ Behaviour in Motor Insurance Using Discrete Choice Models. Economics and Management, 20(4), 88-102.
England, R., Owadally, I., & Wright, D. (2022). An Agent-Based Model of Motor Insurance Customer Behaviour in the UK with Word of Mouth. Journal of Artificial Societies and Social Simulation, 25(2), 1-28. https://doi.org/10.18564/jasss.4768.
Eygü, H., & Soğukpınar, F. (2012). Araç Sahiplerinin Kasko Sigorta Poliçesi Edinmesinde Etkili Olan Faktörlerin Araştırılması. İşletme Araştırmaları Dergisi, 4(3), 148–163.
Falk, A., Becker, A., Dohmen, T. J., Huffman, D., & Sunde, U. (2016). The Preference Survey Module: A Validated Instrument for Measuring Risk, Time, and Social Preferences. IZA Discussion Paper No. 9674.
Filiz, Z., & Şengöz, M. (2010). Kasko Sigortası Tercihinin Konjoint Analizi ile İncelenmesi. ISGUC The Journal of Industrial Relations and Human Resources, 12(1), 107-121.
Gülbitti, L. (2007). Kasko Sigortasının İncelenmesi ve Türkiye’de Kasko Sigortası Hasar Uygulamalarının Değerlendirilmesi. (Unpublished Dissertation). Marmara University.
Hsu, Y.-C., Chou, P.-L., & Shiu, Y.-M. (2016). An Examination of the Relationship Between Vehicle Insurance Purchase and the Frequency of Accidents. Asia Pacific Management Review, 21(4), 231–238. https://doi.org/10.1016/j.apmrv.2016.08.001.
Huyssteen, N., & Rudansky-Kloppers, S. (2024). Factors Influencing Consumers’ Purchase Decisions Regarding Personal Motor Vehicle Insurance in South Africa. Cogent Business & Management, 11(1), 2293488. https://doi.org/10.1080/23311975.2023.2293488.
Ioncică, M., Petrescu, E.-C., Ioncică, D., & Constantinescu, M. (2012). The Role of Education on Consumer Behavior on the Insurance Market. Procedia-Social and Behavioral Sciences, 46, 4154–4158. https://doi.org/10.1016/j.sbspro.2012.06.217.
Karagöz, Y., Demir, M., & Günel, Y. (2019). Araç Kasko Sigortası Yaptırırken Şirket Seçimini Etkileyen Faktörlerin Tespitine Yönelik Ölçek Geliştirilmesi. Balıkesir Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 22(42), 227-254.
Kawiński M. and Szumlicz T. (2023). Insurance Under and Over Performance: The Case of Comprehensive Car Insurance in Poland. Contemporary Economics. 17(4), 443-455.
Kwofie, C., Yormekpe, D. D., Mensah, S. O., & Botchway, P. (2018). Choosing between Alternative Motor Insurance Policies: A Discrete Choice Experiment. International Journal of Mathematics and Mathematical Sciences, 2018, 1-7.
Lim, S., Oh, T., & Ngayo, G. (2023). Analyzing Factors Affecting Risk Aversion: Case of Life Insurance Data in Korea. Heliyon, 9(10), e20697.
Liu, F., Corcoran, C. P., Tao, J., & Cheng, J. (2016). Risk Perception, Insurance Recognition and Agricultural Insurance Behavior–An Empirical Based on Dynamic Panel Data in 31 Provinces of China. International Journal of Disaster Risk Reduction, 20, 19–25.
Lyu, K., & Barré, T. J. (2017). Risk Aversion in Crop Insurance Program Purchase Decisions: Evidence from Maize Production Areas in China. China Agricultural Economic Review, 9(1), 62–80. https://doi.org/10.1108/CAER-04-2015-0036.
Masud, M. M., Ahsan, M. R., Ismail, N. A., & Rana, M. S. (2021). The Underlying Drivers of Household Purchase Behaviour of Life Insurance. Society and Business Review, 16(3), 442–458. https://doi.org/10.1108/SBR-08-2020-0103.
Mihaela C., Iulian M. and Ioana M.D. (2013). On Some Determinants of Demand or Renunciation for Renewal of CASCO (Motor Hull) Insurance Policies for Individual. Ovidius University Annals, Economic Sciences Series, 13(1), 1176-1179.
Özen, E., & Yurdakul, H. (2020). Trafik ve Kasko Sigortalarında Hasar Süreçlerine İlişkin Müşteri Algılarını Etkileyen Faktörler (Uşak İli Örneği), Balıkesir Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, 1(1), 94-117.
Panjaitan, E., Sinulingga, S., & Wibowo, R. P. (2019). The Effect of Marketing Mix on Consumer Purchase Decision On Bright Gas Product in Medan (Study In PT Pertamina (Persero) Marketing Operation Region I). International Journal of Research and Review, 6(10), 205-212.
Pikulina, E., Renneboog, L., & Tobler, P. N. (2017). Overconfidence and Investment: An Experimental Approach. Journal of Corporate Finance, 43, 175-192.
Sarman, I., Curtale, R., & Hajibaba, H. (2020). Drivers of Travel Insurance Purchase. Journal of Travel Research, 59(3), 545–558. https://doi.org/10.1177/0047287519843187.
Sedgwick, P. (2013). Convenience Sampling. BMJ, 347, f6304. https://doi.org/10.1136/bmj.f6304.
Şimşekoğlu, Ö., Nordfjærn, T., & Rundmo, T. (2012). Traffic Risk Perception, Road Safety Attitudes, and Behaviors Among Road Users: A Comparison of Turkey and Norway. Journal of Risk Research, 15(7), 787–800.
Şimşekoğlu, Ö., Nordfjærn, T., Zavareh, M. F., Hezaveh, A. M., Mamdoohi, A. R., & Rundmo, T. (2013). Risk Perceptions, Fatalism and Driver Behaviors in Turkey and Iran. Safety Science, 59, 187–192. https://doi.org/10.1016/j.ssci.2013.05.014.
Stankov, L., & Lee, J. (2014). Overconfidence Across World Regions. Journal of Cross-Cultural Psychology, 45(5), 821-837. https://doi/10.1177/0022022114527345.
Störmer, T. (2014). Do Customers Value Cost-Based Price Transparency in Motor Insurance? Effects on Consumers' Purchase Intentions, Loyalty and Willingness to Pay. Working paper, Risk Management and Insurance No. 144, University of St. Gallen.
Tan, W. K., Tan, C. H., & Teo, H. H. (2012). Consumer-based Decision Aid that Explains Which to Buy: Decision Confirmation or Overconfidence Bias?. Decision Support Systems, 53(1), 127-141. https://doi.org/10.1016/j.dss.2011.12.010.
Techasurin, W., Nuangjamnong, C., & Dowpiset, K. (2020). Factors Influencing Consumer Purchasing Decision of Used Car Insurance in Bangkok. Retrieved from: SSRN 3787492. http://doi.org/10.2139/ssrn.3787492
Ulbinaite, A., Kucinskiene, M., & Le Moullec, Y. (2013). Determinants of Insurance Purchase Decision Making in Lithuania. Inzinerine Ekonomika-Engineering Economics, 24(2), 144–159. https://doi.org/10.5755/j01.ee.2.24.2.3439.
Wooldridge, J. M. (2020). Introductory Econometrics: A Modern Approach. Boston: Cengage.
Yamane, T. (1973). Statistics and Introductory Analysis. New York: Harper & Row.
Yang, F., Tan, J., & Peng, L. (2020). The Effect of Risk Perception on the Willingness to Purchase Hazard Insurance—A Case Study in the Three Gorges Reservoir Region, China. International Journal of Disaster Risk Reduction, 45, 101379. https://doi.org/10.1016/j.ijdrr.2019.101379.
Yayar, R., & Daşcı, A. (2019). Kasko Sigortası Tercihini Etkileyen Faktörler: Kars İli Örneği. Bankacılık ve Sigortacılık Araştırmaları Dergisi, 13, 8-21.
Yıldırım, A., Eryılmaz, C., & Büyükarıkan, U. (2020). Sigorta Sözleşmeleri Standardına Göre Sigorta Muhasebesi. Karadeniz Sosyal Bilimler Dergisi, 12(23), 534-548.
Zakaria, R., & Ayoub, A. (2023). Prediction of The Act of Termınatıon of Car Insurance Contracts at the End of Their Term. Journal of Theoretical and Applied Information Technology, 101(4), 1229-1247.
Zheng, W., Yao, Y., Shi, P., Deng, Y., & Zheng, H. (2021). Deregulation, Competition, and Consumer Choice of Insurer: Evidence from Liberalization Reform in China’s Automobile Insurance Market. The Geneva Risk and Insurance Review, 47, 158-200.
DOI: 10.15408/etk.v23i2.37807
Refbacks
- There are currently no refbacks.
Copyright (c) 2024 Muhammet Kutlu, Serpil Sumer Adin, Hilal Mola, Şeyma Şahin Kutlu
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
