Several econometric factors have been hypothesized to influence the demand for life insurance products. This study examined the relationship of seven variables to the life insurance demand in Malaysia. The variables were domestic gross product, per capita income, current interest rate, short term interest rate, inflation rate and personal savings rate. The paper also studied the effect of income tax exemption on the demand for life insurance. The data analyzed were collected for the period 1970 through 1997. The results of the stepwise regression analysis showed that four of the variables tested had some influence the demand of life insurance in Malaysia, namely the gross domestic product, the short term interest rate, the personal savings rate and the income tax exemption.