Insurance literacy among older people in Japan: The role of socio‐economic status

Insurance literacy has received little attention in academic research despite its role in risk management, particularly among older people, a population most in need of a secure income and coverage for health care expenses after retirement. Using data from the Survey on the Economic Status of the Japanese Elderly conducted by Hiroshima University, we examined how the socio‐economic status of older people in Japan was related to the attainment of insurance literacy. We found that the overall level of insurance literacy was quite low among older people in Japan, particularly among the oldest subgroup and women. Our regression results show that older people who are men, married, relatively younger, moderately educated, have a higher balance of financial assets, and those who have work experience in management, business, or finance are more likely to be insurance literate. Our results indicate that social learning plays an important role in insurance literacy.