When Trust Meets Value: Drivers of Life Insurance Purchase Decisions among South Sulawesi Consumers

DOI

10.2991/978-94-6239-709-5_16How to use a DOI?

Keywords

Life Insurance; Trust; Perceived Value; Financial Literacy; Purchase Decisions

Abstract

This study examines the drivers of life-insurance purchase decisions in South Sulawesi’s bancassurance context, addressing a high-inclusion/low-literacy paradox and persistent trust deficits. Integrating trust, agent credibility, perceived risk, perceived value, premium affordability, subjective norms, and financial literacy, we estimate a variance-based structural equation model using crosssectional survey data (n = 135). The reflective measurement model demonstrates strong reliability and convergence (CR ≥ .86, AVE ≥ .61), with discriminant validity supported (HTMT < .85). Structural results show trust as the strongest proximal predictor of purchase, agent credibility exerting both a small direct effect and a larger indirect effect via trust, and perceived value positively associated with purchase. Perceived risk relates negatively to both trust and purchase. Financial literacy increases perceived value and reduces perceived risk, while premium affordability primarily influences purchase indirectly through perceived value. Subjective norms show a modest positive association with purchase. Explanatory power is substantial (R²_purchase = .64) and predictive relevance is confirmed (positive Q², PLSpredict outperforming a linear benchmark). The findings position trust as the gateway belief through which affordability and literacy translate into value and, ultimately, purchase. Managerial implications include radical transparency (plain-language exclusions and claims SLAs), re-professionalized agents as educators, affordability-aligned premium ladders, and a hybrid distribution that blends digital simplicity with human reassurance. Policy recommendations emphasize transparent-by-design disclosures and targeted, product-specific financial education.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Ika Yulia Hadiyanti
AU  - Mursalim Nohong
PY  - 2026
DA  - 2026/06/20
TI  - When Trust Meets Value: Drivers of Life Insurance Purchase Decisions among South Sulawesi Consumers
BT  - Proceedings of the 10th International Conference on Accounting, Management, and Economics (10th ICAME 2025)
PB  - Atlantis Press
SP  - 213
EP  - 227
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-709-5_16
DO  - 10.2991/978-94-6239-709-5_16
ID  - Hadiyanti2026
ER  -