Effects of Promotional Strategies on Penetration of Life Insurance Products in South East, Nigeria:- Ekwe Blessing N

Abstract

This study investigated the effects of promotional strategies on penetration of life insurance products in south- east Nigeria. Specifically, the study examined the influence of four promotional strategies (Advertising, Personal selling, direct marketing and referral marketing) on the number of life products sold and on the number of policy holders of the selected life insurance firms in the region. The study adopted a survey research design and used structured questionnaire to collect data from two hundred and five (205) staff of the selected insurance firms in the study area. Out of Two hundred and five copies of questionnaire distributed, one hundred and eighty (180) were found properly filled, completed and returned by the respondents. The data collection instrument was subjected to standardization and validity test. The reliability and internal consistency tests ofthe questionnaire were done with the aid of Cronbach’s alpha which gave a high reliability co-efficient of 0.904. Data collected were analyzed using descriptive statistics such as frequencies, percentages and mean scores of the responses by the respondents and presented in tables for each promotional strategy under study. The hypotheses stated in this work were subjected to statistical test with ordinary least squares (OLS) method of multiple regression, using the statistical package for social sciences (SPSS) version 20. The study revealed that all the predictor variables used as promotional tools under advertising, employed in the study have positive and significant effects on the life insurance penetration variables, that is, the number of life products sold and the number of life policy holders in the study area. On the other hand, one predictor variable under personal selling strategy (person to person interaction) indicated negative effect on the number ofproducts sold, while the rest showed positive and significant effect on both the numbers of products sold and the number of life policy holders in the region. Furthermore, the study found that all the predictor variables under direct marketing and referral marketing had positive but moderate effect on the number of life products sold as well as on the number of life policy holders. Therefore, we concluded that the depth or the degree of penetration of life policy products within the south east region of Nigeria, depends significantly on the extent of promotional activities deployed by the insurance firms. Based on this, we recommended that insurance companies should engage in more frequent promotional activities in the south east region of Nigeria as it was seen that the more frequent the number of promotional activities, the more the penetration oftheir life products in the study area. It was also recommended that insurance firms should engage experts in marketing communications to create some appropriate promotional messages that can appeal to their prospective customers and thereby deepen the penetration ofthese products in the region.