Journal Press India^®

Author Details ( * ) denotes Corresponding author

This study investigates the impact of overconfidence on investment decisions and the role of overconfidence as a mediator between behavioral biases and investment decisions of life insurance investors. Therefore, it is important to examine the behavioral biases that influence life insurance investors’ investment decisions. The authors assessed investors’ behavioral biases and investment decisions regarding life insurance using a structured questionnaire. Results of SEM revealed that the investment decisions of life insurance investors were impacted significantly and positively by the overconfidence bias. Evidence from this study also suggests that overconfidence mediates the relationship between availability, conservatism, and investment decisions. The findings of this study will help researchers, investors investing in life insurance, life insurance companies, and policymakers. The novelty of this paper is that the researchers have validated the overconfidence bias scale in the context of life insurance and examined the impact of overconfidence bias on investment decisions.

Keywords

Behavioral Biases; Investment Decisions; Mediation Analysis; Life Insurance; Psychological Heuristics

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