Factors Affecting the Consumer’s Purchase Decisions of Health Insurance in Uganda: A Case of AAR Insurance Company

Abstract

The study was an investigation of factors affecting the consumer’s purchase of health insurance in Uganda. A case of AAR insurance company. Specifically, it found out the effect of compensation/claim amount, family size, and age of patient, number of hospital visits, type of place of residence and the type of insurance cover on the demand for health insurance by aar medical insurance customers. The data used in this study as strictly secondary data which was obtained from AAR medical insurance company on variables under study. The study findings showed that all the insured were aged between 1 and 87 years. Of these, 57% (n=6,747) while 43 % (n=5,171) were female, the dominant proportion of the insured persons were actually unmarried (57%; n=6,798) while 43% (n= 5,120) were married. Most (60%; n=7,223) of the insured subscribed for the Ugandan insurance cover; 36% (n=4,403) which was found to vary with cost. Also. Demand for health insurance was is strongly positive and significant related to the claim amount, another finding was that family size, number of visits to the health facility and age of patients exhibited a statistically significant correlation with the demand for health insurance. Further, compensation, family size, age of patient, number of hospital visits, marital status and of type of insurance cover had a statistically significant relationship with the demand for health insurance unlike the type of residence. Consumers purchase decisions are highly determined by the compensation amount, higher compensations by the insurance companies attract consumers to buy more insurance covers from the insurance companies. There is need to reduce on the cost of insurance and increase on the claim amount to attract Ugandans from buying even the world wide type of insurance covers