THE MODERATION ROLE OF FINANCIAL LITERACY TO INFLUENCE FINANCIAL BEHAVIOR ON INSURANCE INVESTMENT DECISIONS

Abstract

Today financial literacy can also help improve a person’s well-being in financial behavior. Purpose of this study is to identify the moderation role of financial literacy influencing financial behavior on insurance investment. The data used are primary data and as a measure he collects directly by distributing questionnaires containing three Likert parts. The questionnaire includes financial literacy, financial behavior, and decisions on insurance investment. This research focuses on unit-linked insurance customers in East Java, Indonesia. The samples were obtained from individuals living in East Java with unit-linked insurance. The total number of respondents is 102 respondents aged from 25 to 40 years old. Most of the respondents are female with 52 people or 53.6%, while male 46.4%. Also, most of the respondents who work as employees or entrepreneurs have a college degree (45 people or 46.4%). The majority of respondents had unit-linked funds placement on a fixed income (39 people or 58.2%). Data analysis technique consists of testing the validity and reliability, simple linear regression, hypothesis testing, and moderated regression analysis. The findings show that financial behavior positively and significantly affects insurance investment decisions, moderated by financial literacy.

Keywords

• insurance
• financial behavior
• financial literacy
• investment decision
• unit-linked
• individual