Abstract:

This study intended to investigate the moderation effect of respondents’ socio-economic status namely education and income on the relationship between vulnerabilities and their need for protection through micro-insurance.  The target population of this study was the poor and low income people in certain parts of Malaysia. A total of 300 self-administered questionnaires were returned and usable for further analysis. The analysis was carried out using Structural Equation Modeling (SEM) with AMOS Graphic 21.0. The results showed that the respondents’ level of education and income significantly moderate the relationship between the vulnerability and their need for micro-insurance. The two moderators provide partial moderation effects on the relationship. However, the moderation effects are more pronounced for respondents with Low Education level and also Low Income level compared to respondents of High level of Education and Income.  The implications of this study on the future of micro-insurance industry in the country were discussed.