Pest: Investment and Insurance Industry
PESTE Analysis
PEST analysis (Political, Economic, Social and Technological analysis) describes a framework of macro-environmental factors used in the environmental scanning component of strategic management. Insurance is one of the service factor that are expected to continue to drive growth in the economy. Thus the insurance sector play important role in supporting economic ,social and technology development.
Economical factor
Interest rate at bank very much affect to insurance industry, because people always attract by higher return. Therefore, they do not prefer lower return policy. Unemployment also affects insurance industry, because the unemployment people will not have earning, so saving also affect to life insurance sector. Life insurance industry will directly affected by Earthquake, Monsoon, and Natural calamity. Because of these events turns into lots of death, so the life insurance companies have to pay claim against policy. Infant mortality rate and maternity mortality rate are also affecting to insurance. Typical consumer want luxurious product against low income, so that they prefer installment or annuity (EMI), so thatthey may not have extra saving to invest in life insurance.
Social factor
The population in the age group 15-55 is usually regarded as the insurable population, since this can be considered as the main “active” age group ( in the sense of working, earning and supporting others), and beyond this range life risk may be considered to be not worth insuring. On the other hand, people over the age of 50 rarely apply for fresh life insurance, mainly because in Malaysia the normal retirement age is around 55- 60 years. Also, a high percentage of the population in the lower income group does not remain “insurable” after the age of 50.
A single respondent is less likely to purchase life insurance than a married respondent. Given that a married respondent is likely to have family members or dependents to care for, it is reasonable to
PEST analysis (Political, Economic, Social and Technological analysis) describes a framework of macro-environmental factors used in the environmental scanning component of strategic management. Insurance is one of the service factor that are expected to continue to drive growth in the economy. Thus the insurance sector play important role in supporting economic ,social and technology development.
Economical factor
Interest rate at bank very much affect to insurance industry, because people always attract by higher return. Therefore, they do not prefer lower return policy. Unemployment also affects insurance industry, because the unemployment people will not have earning, so saving also affect to life insurance sector. Life insurance industry will directly affected by Earthquake, Monsoon, and Natural calamity. Because of these events turns into lots of death, so the life insurance companies have to pay claim against policy. Infant mortality rate and maternity mortality rate are also affecting to insurance. Typical consumer want luxurious product against low income, so that they prefer installment or annuity (EMI), so thatthey may not have extra saving to invest in life insurance.
Social factor
The population in the age group 15-55 is usually regarded as the insurable population, since this can be considered as the main “active” age group ( in the sense of working, earning and supporting others), and beyond this range life risk may be considered to be not worth insuring. On the other hand, people over the age of 50 rarely apply for fresh life insurance, mainly because in Malaysia the normal retirement age is around 55- 60 years. Also, a high percentage of the population in the lower income group does not remain “insurable” after the age of 50.
A single respondent is less likely to purchase life insurance than a married respondent. Given that a married respondent is likely to have family members or dependents to care for, it is reasonable to