Life insurance in Malta : an evaluation

Abstract

This dissertation takes a close look at the life insurance market in Malta and provides a high level comparison of the key trends in the Maltese life insurance market with those in the life insurance market in Europe. It seeks to determine Maltese consumers' perception of life insurance, the industry and the product offerings. This dissertation also seeks to establish the likely potential for growth in the life insurance market in Malta as it converges to the European average density and penetration ratio. The study also outlines the uses and benefits of life insurance together with the economic benefits to the state. One of the main findings of this study is that there is general lack of trust in life insurance companies and the best way to overcome this barrier is through better communication and engagement with customers. From this study it was also concluded that there is a lack of general awareness of the benefits and value of life insurance products. At the present, the life insurance sector in Malta is essentially made up of home buyers who are required to take out life insurance as part of their collateral when borrowing money from commercial banks to finance the purchase of property. Most people think that life insurance is too expensive whilst others do not really understand the need for it. People need to be informed about the importance of having life insurance to protect one's family as well as their future. On the other hand, the government needs to encourage voluntary savings and long-term provision through fiscal and other incentives in order to reduce the dependency on the state. The government should also seek to reform the pension system and introduce second and third pillars of pension. The long awaited pension reform is regarded as the single