Insurance uptake and risk-exposure perception in Arua City, Uganda
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Date
2026-05-04
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Uganda Christian University
Abstract
The present study assessed the correlation between perception of risk exposure and insurance coverage among people living in Arua City. Insurance plays an important role in as shielding people from financial shocks such as disease, theft, fire and economic fluctuations. Although there are insurance companies in Uganda, insurance coverage is very low, especially in secondary towns like Arua. The study aimed at establishing the relationship between risk exposure perception and the decision of Arua inhabitants to purchase insurance. Insurance plays a crucial role for both individuals and business organizations since it compensates for losses that may be incurred as a result of accidents, theft,or fire. However, buying insurance remains a luxury in Uganda. Cross-sectional design was used to collect information from 60 participants via structured questionnaires. This data was analyzed using descriptive statistics, correlation and logistic regression analyses. The results indicate that only 23 percent of respondents had insurance cover. While the respondents exhibited relatively high risk exposure, it did not lead to insurance uptake at all times. There was a moderate positive relationship between risk perception and insurance uptake( r = 0.56, p< 0.01). Trust in insurance companies had more influence on insurance uptake than risk perception. The conclusion drawn from the research is that insurance companies should increase trust and knowledge about their products in order to increase insurance adoption in Arua City
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Undergraduate