Determinant Factors of Insurance Demand by SMEs in Malaysia

  • Junainah Junid
  • Siti Zahrah Buyong
  • Khuzaimah Akasah
Conference paper


Malaysian SMEs dominate the market by 90 %. Realising the power of business among SMEs, entrepreneurs need to ensure business continuity by protecting businesses from any occurrence of risk. This research aims to investigate the determinant factors of insurance demand by SME entrepreneurs putting insurance not only as coverage but also as readiness for any disaster faced by businesses in the future. This initiative has led to insurance being considered as a prudent financial risk management for entrepreneurs. A good approach to Look East Policy with respect to SMEs in Japan realises the importance of insurance to protect the business; SMEs in Malaysia should emulate this good practice to secure their business. Some variables identified in this study are premium flexibility, level of income, education and gender of the respondents. Statistical analysis was used in validating the findings and therefore leads to the identification of determinant factors that urge employers to purchase insurance. Appropriate recommendations based on the findings are thrown out to insurance companies, which should be considered for the betterment of offering insurance to micro business entrepreneurs in the future.


Abnormal Return Business Owner Insurance Policy Determinant Factor Free Cash Flow 
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Copyright information

© Springer Japan 2015

Authors and Affiliations

  • Junainah Junid
    • 1
  • Siti Zahrah Buyong
    • 1
  • Khuzaimah Akasah
    • 1
  1. 1.Malaysian Academy of SME and Entrepreneurship DevelopmentUniversity Technology MARAShah AlamMalaysia

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