Do Independent Agent Insurers Provide Superior Service? The Insurance Marketing Puzzle

Barrese, James; Doerpinghaus, Helen I.; Nelson, Jack M.

doi:10.2307/253793

Cited by 51 publications

(23 citation statements)

References 17 publications

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“…On the other hand, empirical support for the hypothesis that brokers actually do provide a higher quality of service also exists. For example, Barrese et al (1995) obtain this result on the basis of using complaint data in the context of private passenger automobile insurance. In the same line, Berger et al (1997) find that the cost differential between independent and exclusive agents is more due to different service qualities than market imperfections.…”

Section: Related Literaturementioning

confidence: 99%

Reinsurance Brokers and Advice Quality: Is There a Need for Regulation?

Sonnenholzner¹,

Friese

Schulenburg

2009

Geneva Risk Insur Rev

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Brokers play an increasing role in the distribution of reinsurance. In order to analyse reinsurance brokers' advice quality, we employ a model in which a monopoly broker advises cedents to buy a particular one out of similar reinsurance policies that cost the same but differ in details. The broker decides on how much to invest in his advice quality and on the price to charge for his service. We find that the broker's advice quality is generally lower and the price for his service higher than in the social optimum, even in the presence of a potential new entrant.

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Section: Related Literaturementioning

confidence: 99%

Reinsurance Brokers and Advice Quality: Is There a Need for Regulation?

Sonnenholzner¹,

Friese

Schulenburg

2009

Geneva Risk Insur Rev

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“…We follow the prior literature (e.g., Barrese et al 1995;Regan and Tzeng 1999) and divide P-L insurance businesses into personal auto physical damage and liability insurance (AUTO), homeowners insurance (HOMEOWN), fire (FIRE), commercial multiperils (COMPER), inland marine (INLANDM), ocean marine (OCEAN), allied lines (ALLIED) and workers' compensation (WORKER). The rest of lines are categorized as ''others'' and this category is omitted from the regression model to avoid collinearity.…”

Section: By-line Business Incomementioning

confidence: 99%

Dividend decisions in the property and liability insurance industry: mutual versus stock companies

Zou

Yang

Wang

et al. 2008

Rev Quant Finan Acc

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“…3 Posey and Yavas (1995); Kim et al (1996); Berger et al (1997); Posey and Tennyson (1998);Seog (1999); Venezia et al (1999);Trigo-Gamarra (2008). 4 Etgar (1976); Barrese and Nelson (1992); Barrese et al (1995); Kim et al (1996); Berger et al (1997);…”

Section: Introductionmentioning

confidence: 99%

“…5 Venezia et al (1999). 6 Barrese and Nelson (1992); Barrese et al (1995); Kim et al (1996); Berger et al (1997);Trigo-Gamarra (2008). 7 Cawley and Philipson (1999); Chiappori and Salanie (2000); Dionne et al (2001);Saito (2006).…”

Section: Introductionmentioning

confidence: 99%

Insurance Marketing Channel as a Screening Mechanism: Empirical Evidences from Taiwan Automobile Insurance Market

Hsieh

Liu

Tzeng

2013

Geneva Pap Risk Insur Issues Pract

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Venezia, Galai and Shapira in 1999 proposed a theoretical framework that considers asymmetric information to explain the co-existence of the independent agent and direct underwriting systems in the insurance market. In separating equilibrium, high-risk clients tend to purchase insurance through independent agents, whereas low-risk clients prefer dealing directly with underwriters. Using a unique data set from Taiwan's automobile liability insurance, this paper tests the screening mechanism hypothesis proposed by Venezia, Galai and Shapira. The results reveal that a positive channel-claim correlation exists in the subsamples of cars aged more than three years. Significant positive channel-claim correlation indicates that high-risk policyholders prefer to purchase insurance from an independent agent, whereas those with lower risks tend to buy insurance from direct writer channels. The results support the screening mechanism hypothesis and demonstrate that marketing channel choice could serve as a screening mechanism in an insurance market characterised by asymmetric information.

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Do Independent Agent Insurers Provide Superior Service? The Insurance Marketing Puzzle

Cited by 51 publications

References 17 publications

Reinsurance Brokers and Advice Quality: Is There a Need for Regulation?

Reinsurance Brokers and Advice Quality: Is There a Need for Regulation?

Dividend decisions in the property and liability insurance industry: mutual versus stock companies

Insurance Marketing Channel as a Screening Mechanism: Empirical Evidences from Taiwan Automobile Insurance Market

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