Abstract
Challenges are faced by individuals in making financial decisions throughout their life to be financially well. Managing risk such as health risks may incur high cost to remain healthy. Individuals make decisions on having protection against health risks in the long run which depends on several factors. This study focused on the behavioral aspects of finance which attempts to assess factors predicting health insurance purchase among Malaysian public sector employees. The likelihood of personality and health risks factors in predicting health insurance purchase were determined. Multistage random sampling based on four zones in Peninsular Malaysia was utilized to sample 500 respondents from four states. Selected departments in the states were contacted prior to the data collection for their consent. Respondents identified by liaison officers in each department were given self-administered questionnaires resulting in 356 usable questionnaires. Apart from socioeconomic characteristics and health insurance purchase, data on investment, personality and health status were collected. Personalities measured were self-esteem, risk-averse and future-orientation, while health risks were measured through health status using SF-36. The primarily measures and the aggregate measures of health were analyzed in two separate binomial logistic regressions where both analyses revealed that income was the strongest predictor as compared to investment activity or self-esteem. None of the indicators for health risks was found to be significant in predicting health insurance purchase. Both models were justified as fit by being moderately correctly classified and were more than 25% improvement over the chance accuracy rate. It is concluded that the decision on protection against health risks using health insurance is not based on their health risks instead the decision depends more on their income. As these are employees in the public sector, it may reflect high reliance on the government health service. Nevertheless, the public sector is considered as a potential market for health insurance industry.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Abdullah, L., & Abdul Rahman, M. N. (2012). Employee likelihood of purchasing health insurance using fuzzy inference system. International Journal of Computer Science Issues, 9(1), 112–116.
Altfest, L. (2004). Personal financial planning: Origins, developments and a plan for future direction. The American Economist, 48(2), 53–60.
Bank Negara Malaysia. (2005a). Annual Takaful statistics. Putrajaya: Department of Statistic.
Bank Negara Malaysia. (2005b). Insurance annual report. Putrajaya: Department of Statistic.
Bank Negara Malaysia. (2010a). Annual Takaful statistics. Putrajaya: Department of Statistic.
Bank Negara Malaysia. (2010b). Insurance annual statistics. Putrajaya: Department of Statistic.
Baumeister, R. F., Bushman, B. J., & Campbell, W. K. (2000). Self-esteem, narcissism, and aggression: Does violence result from low self-esteem or from threatened egotism? Current Directions in Psychological Science, 9(1), 26–29.
Beal, S. J., & Crockett, L. J. (2010). Adolescents’ occupational and educational aspirations and expectations: Links to high school activities and adult educational attainment. Developmental Psychology, 46(1), 258–265.
Becker, G. (1965). A theory of the allocation of time. The Economic Journal, 75, 493–517.
Buchmueller, T. C., Fiebig, D. G., Jones, G., & Savage, E. (2013). Preference heterogeneity and selection in private health insurance: The case of Australia. Journal of Health Economics, 32(5), 757–767.
Bundorf, M. K., & Pauly, M. V. (2006). Is health insurance affordable for the uninsured? Journal of Health Economics, 25(4), 650–763.
Cardak, B. A., & Wilkins, R. (2009). The determinants of household risky asset holdings: Australian evidence on background risk and other factors. Journal of Banking and Finance, 33(5), 850–860.
Chiappori, P., Jullien, B., Salanié, B., & Salanié, F. (2006). Asymmetric information in insurance: General testable implications. RAND Journal of Economics, 37(4), 783–798.
Denton, M. A., Kemp, C. L., French, S., Gafni, A., Joshi, A., Rosenthal, C. J., et al. (2004). Reflexive planning for later life. Canadian Journal on Aging, 23(Suppl 1), S71–S82.
Einav, L., Finkelstein, A., & Schrimpf, P. (2010). Optimal mandates and the welfare cost of asymmetric information: Evidence from the U.K. annuity market. Econometrica, 78(3), 1031–1092.
Fang, H., Keane, M., & Silverman, D. (2008). Sources of advantageous selection: Evidence from the Medigap insurance market. Journal of Political Economy, 116(2), 303–350.
Finkelstein, A., & Poterba, J. (2002). Selection effects in the United Kingdom individual annuities market. The Economic Journal, 112, 28–50.
Grable, J. E., & Joo, S. (2001). A further examination of financial help-seeking behavior. Financial Counseling and Planning, 12(1), 55–74.
Hershey, D. A., & Mowen, J. C. (2000). Psychological determinants of financial preparedness for retirement. The Gerontologist, 40(6), 687–697.
Hira, T. K., & Mugenda, O. M. (1999). The relationships between self-worth and financial beliefs, behavior and satisfaction. Journal of Family and Consumer Sciences, 91(4), 76–83.
Hosmer, D. W., & Lemeshow, S. (2013). Applied logistic regression (3rd ed.). New York: Wiley.
Husniyah, A. R., Mohamad Fazli, S., & Ahmad Hariza, H. (2005). Gelagat perancangan kewangan keluarga di Malaysia [Family financial planning behavior in Malaysia]. Malaysian Journal of Consumer and Family Economics, 8, 27–39.
Institute for Public Health. (2008). National health and morbidity survey III. Putrajaya: Ministry of Health Malaysia.
Jacobs-Lawson, J. M. (2003). The influence of age, gender, and investor characteristics on individuals’ retirement investment decisions. Doctoral dissertation, Oklahoma State University, Stillwater.
Jacobs-Lawson, J. M., & Hershey, D. A. (2005). Influence of future time perspective, financial knowledge, and financial risk tolerance on retirement saving behaviors. Financial Services Review, 14, 331–344.
Kunreuther, H., & Pauly, M. (2005). Insurance decision-making and market behavior. Foundations and Trends in Microeconomics, 1(2), 63–127.
Lazim, A., & Mohd Nordin, A. R. (2012). Employee likelihood of purchasing health insurance using fuzzy inference system. International Journal of Computer Science Issues, 9(1), 112–116.
Malaysian Department of Statistics. (2014a). Household expenditure survey 2014. Putrajaya: Department of Statistics.
Malaysian Department of Statistics. (2014b). Report of household income and basic amenities survey 2014. Putrajaya: Department of Statistics.
McLaughlin, C. G., Crow, S. E., Harrington, M., & Kuttner, H. (2004). Causes and consequences of lack of health insurance: Gaps in our knowledge. In C. McLaughlin (Ed.), Health policy and the uninsured (pp. 9–25). Washington, DC: The Urban Institute Press.
Modigliani, F., & Brumberg, R. (1954). Utility analysis and the consumption function: An interpretation of the cross section data. New Brunswick, NJ: Rutgers University Press.
Parente, S. T., Feldman, R., & Christianson, J. B. (2004). Employee choice of consumer-driven health insurance in a multiplan, multiproduct setting. Health Services Research, 39(4 Pt 2), 1091–1112.
Seginer, R. (2003). Adolescent future orientation in culture and family settings. In W. Friedlmeier, P. Chakkarath, & B. Schwarz (Eds.), Culture and human development: The importance of cross-cultural research to the social sciences (pp. 231–252). Lisse: Swets & Zietlinger Publishers.
Simons, J., Vansteenkiste, M., Lens, W., & Lacante, M. (2004). Placing motivation and future time perspective theory in a temporal perspective. Educational Psychology Review, 16(2), 121–139.
Stewart, A. L., Hays, R. D., & Ware, J. E. (1988). The MOS short-form general health survey: Reliability and validity in a patient population. Medical Care, 26(7), 724–735.
Strombom, B. A., Buchmueller, T. C., & Feldstein, P. J. (2002). Switching costs, price sensitivity and health plan choice. Journal of Health Economics, 21(1), 89–116.
Ware, J. E., Snow, K. K., Kosisnki, M., & Gandek, B. (1993). SF-36 health survey manual and interpretation guide. Boston: The Health Institute.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2017 Springer International Publishing AG
About this paper
Cite this paper
Husniyah, A.R., Norhasmah, S., Mohamad Amim, O. (2017). Assessing Predictors for Health Insurance Purchase Among Malaysian Public Sector Employees. In: Bilgin, M., Danis, H., Demir, E., Can, U. (eds) Regional Studies on Economic Growth, Financial Economics and Management. Eurasian Studies in Business and Economics, vol 7. Springer, Cham. https://doi.org/10.1007/978-3-319-54112-9_7
Download citation
DOI: https://doi.org/10.1007/978-3-319-54112-9_7
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-54111-2
Online ISBN: 978-3-319-54112-9
eBook Packages: Business and ManagementBusiness and Management (R0)