Abstract
This research focuses on the customer orientation of insurance brokers, whose activity is regulated by the Law on the mediation of private insurances and reinsurances. The goal is to ascertain whether the intermediation inherent in the insurance broker’s activity, which implies a customer-oriented service, entails a positive behaviour that transcends the immediate environment, reaching society. This study presents a comparative analysis between the insurance brokerage society, characterised by a personalised customer service, and banks’ advisory services on insurance. To this end, the study uses a sample of insurance brokerage firms in Spain. The results presented in this study suggest that the customer values the advisory service provided by the broker. However, for a particular business segment in standardized insurance products and products related to banking assets, customers are more likely to resort to the bank’s services. In addition, the results indicate that the commission percentages applied by the entities operating in the banking insurance channel exceed those perceived by the insurance broker. With all this, intermediation in the development of the insurer’s activity can entail social behaviour that involves customer-orientation and, possibly, social service and environmental performance.
Highlights
The insurance market is immersed in a process of deep regulatory changes in different geographic areas
To fill the gap in the literature, this study investigates the customer-oriented service of Spanish brokerage in the insurance industry, focusing directly on aspects like operating performance and the quality of objective and subjective advice
This study was conducted in three stages: First, a review of literature on advisory service of the bancassurance distribution channel; objective and subjective advice and customer-oriented service was carried out in order to identify the relationship between these dimensions, the positive behaviour of the sustainable insurance brokerage and their effects on society
Summary
The insurance market is immersed in a process of deep regulatory changes in different geographic areas. The current process of change favours, on the one hand, a strong development of banks as channels of distribution of insurance products in different markets and, on the other hand, a new flow of revenue stemming from the commissions from the insurance companies for the distribution of their products These products represent a source of complementary profit for the banking sector that compensates for the lower turnover caused by the continuous fall of the Euribor [2], which is the interest rate of reference in the operations involving banking assets and liabilities. To fill the gap in the literature, this study investigates the customer-oriented service of Spanish brokerage in the insurance industry, focusing directly on aspects like operating performance and the quality of objective and subjective advice To this end, we analyse a common practice, which consists in deferring the premiums charged to clients in order to invest them in short-term financial products and extend our analysis to the advisory service of the distribution channel Bancassurance, explaining the process.
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