Customers’ attitudes toward insurance frauds: an application of Adams’ equity theory

Abstract

Purpose – Although research on insurance frauds has found that deductible amount influences customers’ attitudes toward insurance frauds, very little work has further investigated the roles of deductible-premium ratios and insurance experiences. Building on the foundations of Adams' equity theory, the authors examined the impact of the deductible-premium ratios on customers' attitudes toward insurance frauds. The authors also studied the relationship among the experience of applying claims, the reasons customers accept insurance frauds, and customers' intentions to carry out frauds. The paper aims to discuss these issues. Design/methodology/approach – Survey was used, and the sample of this study comes from the full-time civil servants at the Agricultural Research Institutes in Taiwan. Findings – The results showed that the deductible-premium ratios may relate to the responders’ perceptions of insurance frauds. In addition, the reasons customers accept frauds were also the influential predictors of the customer frauds. Originality/value – Previous studies found that an unfair treatment by an insurer (e.g. an unfair deductible amount) may enhance customer insurance frauds. However, the “fairness and fraud” problems should involve the consideration of insurance premium because a high deductible amount is usually associated with lower premium. The other discussions of perceived fairness also accept that perceived fairness was often rooted in a social comparative situation. Based on the literature gap, this is the first time that Adams’ equity theory is applied in the customer insurance fraud research.

Neutralization techniques as a moderating mechanism: Ethically questionable behavior in the Romanian consumer context

“…The first stream of research is concerned with specific behaviors, such as shoplifting (e.g., B.T. Smith & Clarke, ), digital piracy (e.g., Aleassa, Pearson, & McClurg, ) or insurance fraud (e.g., Miyazaki, ; Tseng & Kuo, ). By examining attitude, intention, and/or behavior in one specific context, these studies can help understand the complexity of cognitive decision‐making mechanisms.…”

“…By examining attitude, intention, and/or behavior in one specific context, these studies can help understand the complexity of cognitive decision‐making mechanisms. In insurance industry studies, for example, customer perception of unfairness is shown to be important because “unfair treatment” by an insurer appears to increase the likelihood of customer insurance fraud (Tseng & Kuo, ). The second stream of research engages in more holistic accounts, giving a wider picture of ethically questionable consumer behavior and simultaneously exploring different ethical situations.…”

“…Opportunistic consumer behavior can take several forms, including inflated and fake insurance claims, intellectual property theft or cheating on service recovery (Wirtz & McColl‐Kennedy, ). In this regard, researchers have studied ethically questionable behavior, such as illegal downloading (e.g., Odou & Bonnin, ), customer insurance fraud (e.g., Tseng & Kuo, ) or shoplifting (e.g., B.T. Smith & Clarke, ).…”

Consumer Behaviour and Insurance Claim Fraud in Malaysia

“…Therefore, accurate information regarding the policy which will be bought by consumers should be provided by insurance organizations in order to avoid confusion on the offers provided. Therefore, honesty between consumers and insurance organizations is important as the factor preventing consumers from committing insurance claim fraud (Tseng & kuo, 2014;Burhan, Salleh, & Burhan, 2015) Based on the theory's attribution, the cause and the effect which influence customers' decisionmaking in this matter are related to each other. This is due to its attribution for evaluation of consumers' perception on the assessment of price .…”

Discovering Servant Leader Relations with New Followers in Nonprofit Organizations: Does a Servant Leader Always Serve First?

“…This concept was accentuated by Adams (1963), who wrote on the development of the Equity theory that workers are motivated by the sense that machinations in their workplace or other organization are fair and equitable (Tseng & Kuo, 2014). The Equity Theory was established by Adams (1963) to explain the socio-psychological motivation in relational terms primarily in the workplace regarding fairness and equity (Burrai, Font, & Cochrane, 2015).…”