Insurance Companies In Taiwan Research Articles

Mediating effects of relationship marketing orientation and service quality orientation on policyholder retention in non-life insurance services

PurposeThis study explores the mediating effects of relationship marketing orientation (RMO) and service quality orientation (SQO) on market orientation, selling orientation, and policyholder retention in non-life insurance services. Additionally, it offers important recommendations for non-life insurers in Taiwan for policy development and improving policyholder retention.Design/methodology/approachData were collected from a sample of policyholders belonging to the top five non-life insurance companies in Taiwan. The data were then analyzed with structural equation modeling.FindingsRMO and SQO mediate the effects of the salesperson’s market orientation on policyholder retention. Thus, RMO and SQO are key factors influencing policyholder retention. Consequently, high levels of market orientation should be maintained to increase RMO and SQO, strengthening the retention rate of non-life insurance policyholders.Research limitations/implicationsThe main limitation of this study is its cross-sectional nature. In the future, researchers should collect data from other countries and service industries (e.g. banks, securities, and other financial institutions), expand to different insurance contexts (e.g. life insurance), and conduct longitudinal studies or experimental research.Practical implicationsThe results of this study can act as a guide for providers of non-life insurance services. Based on the research results, we recommend decision-makers pay increased attention to increasing policyholder retention rates by strengthening their firm’s RMO and SQO.Originality/valueFew studies have investigated the relationships among market orientation, selling orientation, RMO, SQO, and policyholder retention in non-life insurance services within Asian contexts in general and specifically in Taiwan. Thus, this study’s theoretical contributions, managerial implications (especially for decision-makers), and the proposed future research directions represent timely and valuable additions to the literature.

An Empirical Study of Internet Insurance in Taiwan Adopting the Theoretical Framework of UTAUT2

Abstract Insurance company managers must focus on improving the quality of internet insurance services in the near future. Since young people are early adopters of internet insurance, insurance companies in Taiwan must introduce value-added services to young people regarding internet insurance and provide more convenient services to older customers. This study investigated the factors that influence the intention of using internet insurance in Taiwan, adopting the theoretical framework of UTAUT2. The study determined which factors influence the intention to use internet insurance to allow insurance companies to develop more marketing strategies. The results of the study revealed that Performance Expectancy, Effort Expectancy, Facilitating Conditions, Perceived Risk, and Price Value significantly influenced consumers' intention to use insurance online services. Facilitating Conditions were also found to be a mediating variable with enhanced effectiveness between Behavioral Intention and Use Behavior. The intention to use had a significant effect on the Use Behavior of insurance network services. JEL classification numbers: G22, M15, Q55. Keywords: UTAUT2, Intention to use, Internet insurance services.

Information asymmetry in medical insurance: an empirical study of one life insurance company in Taiwan

ABSTRACT Based on the data from one anonymous but renowned life insurance company in Taiwan, this paper focuses on a big data analysis using R programming language while adhering to the requisite conditions for the validity of using regression model to test the existence of the issue of information asymmetry in medical insurance. The log-linear regression model is adopted to fit with the data set and it is shown: There is a significantly non-linear positive relationship between the compensations and the insurance coverage, indicating that the issue of information asymmetry does exist among those claimants under discussion; the older those claimants were insured, the more they claimed; women claimed more medical compensation than men; those paying premiums quarterly claimed the highest.

A maximum slacks-based measure of efficiency for closed series production systems

The conventional slacks-based measure (SBM) model measures efficiency based on the target point that is farthest to the decision making unit (DMU) being assessed. The result is that the efficiencies for inefficient DMUs are relatively low, and more effort is required for the DMUs to become efficient. In this research, a model is developed to calculate the SBM efficiency based on the target that is closest to the assessed DMU for a closed series production system, where the outputs of a division are the only inputs for the succeeding division. The efficiency measured from this model satisfies the monotonicity property. It is greater than that measured from the radial model. Since the target is closest to the assessed DMU, less effort is required for inefficient DMUs to become efficient. Furthermore, the efficiency of the system can be decomposed into the product of the efficiencies of the component divisions. The divisions that cause unsatisfactory system performance can thus be detected. Making improvements to these divisions can effectively increase the efficiency of the system. A case of non-life insurance companies in Taiwan with a two-division series structure is studied for illustrative purposes.

The relationships between vehicle characteristics and automobile accidents

AbstractIn this study, the relationships between vehicle characteristics and automobile accidents are examined based on physical damage insurance claims data from a major property insurance company in Taiwan. For the whole sample, we find that the car characteristics index (an estimate for the replacement cost associated with claims) is negatively correlated with the claim probability and positively correlated with claim severity. New cars and sport utility vehicles (SUVs) (compared with Sedans) are associated with higher claim probability. However, SUVs (compared with Sedans) are associated with lower claim severity. Small (compared with large) vehicles are associated with lower claim probability and lower claim severity. Compared with the imported cars from Germany, policyholders with the imported cars from Japan or the US are more likely to file a claim but to have lower claim severity. On subgroup analyses, the relationship between car characteristics index and claim probability is positive for domestic cars and negative for imported cars, implying that imported car policies subsidize domestic car policies. We also find the impacts of vehicle characteristics on claim probability and claim severity differ for domestic cars and imported cars in subsamples. Our empirical evidence provides important implications for premium pricing in the automobile physical damage insurance industry.

Efficiency of Life Insurance Companies: An Empirical Study in Mainland China and Taiwan

The study employs metafrontier and four-stage data envelopment analysis (DEA) to measure the overall and individual efficiency of life insurance companies in mainland China and Taiwan, after applying the slack-based measure (SBM)-DEA model to adjust the differences in the operating environment across production units. The empirical findings show the following: (a) The environmental factors significantly affected the efficiency of all life insurance companies. After the adjustments, the efficiency score of life insurance companies in mainland China and Taiwan drops for 14.01% and 26.64% in regional frontier, and 38.31% and 12.22% in metafrontier frontier. (b) Before 2008, the life insurance companies in Taiwan are more efficient than those in mainland China.

How Do Employees in Different Job Roles in the Insurance Industry Use Mobile Technology Differently at Work?

Background: In Taiwan, the insurance industry has the highest willingness and the largest budgets to implement mobile technology. Companies must continuously monitor, evaluate, and redesign the mobile IT infrastructure during implementation because when employees gain more experience with using mobile IT to support work tasks, they present their preferences and progressive needs. Therefore, exploration of how mobile technology can support the diverse job roles and task characteristics in insurance companies that have implemented mobile IT is vital to improving the efficiency of mobile IT implementation and organizational capacity. Research questions: In insurance companies: 1. How are different mobile devices used differently by salespeople and office staff? 2. What are the differences in the attitudes of salespeople and office staff toward using mobile technology? Literature review: Previous studies that explored employees’ usage of mobile technology suggested that those in different job roles have different mobile technology needs and usage behaviors. These studies support further comparison and investigation of the mobile technology requirements of salespeople and office staff in insurance companies. Methodology: A survey collected empirical data from 177 employees from insurance companies in Taiwan. The participants’ demographic information, attitudes toward applications, perceived advantages, and willingness to use mobile technology were collected and analyzed. Results and conclusions: The results showed that the most important tasks supported by mobile technology were instant communication and information access; developing an organizational culture that supports using mobile technology in job-related tasks can increase employees’ adoption of mobile devices; and smartphones are thought to have better mobility and more functions to support main job tasks than tablets. Based on the findings, this study proposes suggestions for practice and implications for future research.

Evaluating the Operational Efficiency of Life Insurance Companies in Taiwan– An Application of the Dynamic Network SBM Model

Using a Dynamic Network Slack-based Measurement model (Tone & Tsutsui, 2014), this study evaluated the operational efficiency of life insurance firms in Taiwan from 2006 to 2013. In contrast to previous research, we incorporated assets and liabilities management into the model and compared them against optimal efficiency values in order to determine whether firms are earning maximizing profit while ensuring long-term solvency. The life insurance industry in Taiwan has matured. We found that market competitiveness depends on firms size and business model. Financial holdings companies and large corporations are performing strongly, while small local firms and foreign-owned firms scored poorly in technical efficiency. Economies of scale contribute to the business performance of life insurance firms. Life insurance companies that had merged with or been acquired by financial holdings firms showed notable improvement in efficiency. However, change in term efficiency is a warning signal in long-term business performance of life insurance firms. Lastly, most companies achieved optimal carry-over efficiency, indicating that they place considerable emphasis on managing assets and liabilities in order to ensure future solvency.

Financial modeling and improvement planning for the life insurance industry by using a rough knowledge based hybrid MCDM model

Financial modeling for the life insurance industry involves two main difficulties: (1) Selecting the minimal and critical variables for modeling while considering the impreciseness and interrelationships among the numerous attributes and (2) measuring plausible synergy effects among variables and dimensions that might cause undesirable biases for an evaluation model. To overcome these difficulties, this paper proposes a two-stage hybrid approach: Rough financial knowledge is retrieved first, and then the obtained core attributes are measured and synthesized using fuzzy-integral-based decision methods. The main innovation of this study is the use of rough knowledge retrieval procedures and fuzzy measures for exploring the synergy effects on financial performance. This approach is expected to support insurers to systematically improve their financial performance. A group of life insurance companies in Taiwan was analyzed, and the findings support the existence of interrelated synergy effects among the core criteria. In addition, five companies were examined to illustrate financial performance improvement planning with this approach. This study bridges the gap between advanced soft computing techniques and pragmatic financial modeling in a dynamic business environment.

A multilevel analysis of customer engagement, its antecedents, and the effects on service innovation

The present study aims to investigate the factors at both organisational and individual levels influencing customer engagements and the effects of customer engagements on service innovation and business performance. A research model of customer engagement was proposed, and a field survey of insurance companies in Taiwan was conducted; 303 usable questionnaires were collected from 50 insurance/insurance brokerage companies. A multilevel analysis approach was adopted on both the individual and the organisational levels. We found that customer rapport and sales representative integrity enhance customer engagement at the individual level and organisational support for product/service promotion and the use of information technology systems improve customer engagement at the organisational level. Service innovation fully mediates the impact of aggregate customer engagement on business performance. This study not only advances the academic research on customer engagement but also provides a blueprint for service companies to design and improve their customer engagement activities.

A unified model of IT continuance: three complementary perspectives and crossover effects

This study presents a unified model of information technology (IT) continuance, by drawing upon three alternative influences that are presumed to shape continuance behavior: reasoned action, experiential response, and habitual response. Using a longitudinal survey of workplace IT continuance among insurance agents at a large insurance company in Taiwan, we demonstrate that the above influences are interdependent, complementary, and have crossover effects. This study advances IT continuance research by theorizing and validating a unifying model that extends prior perspectives and by explaining interrelationships between these perspectives.

The Integrated Relationship among Organizational Learning, TQM and Firm’s Business Performance: A Structural Equation Modeling Approach

The methodology of the organizational learning and total quality management (TQM) in the industry is becoming crucial, but there are few empirical studies to investigate the relationship between organizational learning and TQM on business performance in non-life insurance industry. The purpose of this paper is to understand the integrated relationship between organizational learning and TQM as two sources of sustainable competitive advantage. The paper proposes several hypotheses related to the relationship among organizational learning, TQM and business performance. A survey method is used to collect empirical data from non-life insurance companies in Taiwan. In this study, 414 effective questionnaires are analyzed and structural equation modeling (SEM) is used to verify the research framework and hypotheses. The empirical findings indicate that: (1) Organizational learning has significant and positive effects on TQM, (2) Both organizational learning and TQM have significant and positive effects on business performance, (3) TQM fosters business performance and play a mediating role between organizational learning and business performance. Therefore, the study demonstrates that the model can integrate organizational learning and TQM practices and enhance business excellence in financial service organizations, and also extend the prior research and contribute to the existing body of literature.

Data Envelopment Analysis with Missing Data: An Application to Life Insurance Industry in Taiwan

A fuzzy Data Envelopment Analysis model is adopted in this paper to assess the operational efficiency of life insurance companies in Taiwan. The study was conducted from 2008 to 2012 and the data were taken from Taiwan Economic Journal and related financial statements provided by the Taiwan Insurance Institute. The results indicate that the operational efficiency of insurance companies affiliated to financial holding companies appears to be better than that of insurance companies not affiliated with financial holding companies, signifying that the synergy generated after a financial holding company is formed and the cross-selling between its subsidiary groups are highly beneficial to the management of a life insurance company affiliated to such a financial holding company. The chief contribution of this paper is that, in the past, the data envelopment analysis models applied often could not calculate due to missing input and output data. The study adopts the fuzzy linear mathematics to solve the uncertainty.

Assessing the competitiveness of insurance corporations using fuzzy correlation analysis and improved fuzzy modified TOPSIS

AbstractTo obtain greater profit, insurance firms not only need to provide attractive insurance products but also effectively promote their products. A growing number of insurance companies have thus heavily invested in marketing. Therefore, the proposed assessment framework integrates the fuzzy analytical hierarchy process and the improved fuzzy modified technique for order preference by similarity to the ideal solution (improved fuzzy modified TOPSIS) to acquire the efficiency scores of the alternatives (i.e. insurance companies) being evaluated. The improved fuzzy modified TOPSIS computes efficiency scores of insurance companies based on the Mahalanobis distances, taking into account the fuzzy correlations between the indicators and the weighted distance of fuzzy modified TOPSIS. The advantage of calculating the Mahalanobis distances over the Euclidean distances, which are typically used in the literature, is that the undulation of efficiency scores can be decreased. The assessment criteria have high correlations with each other. This assessment framework is applied to appraise the marketing performance of four major insurance companies in Taiwan. The assessment and comparison results are proved to be consistent with those published by an independent business survey institute.

The Effects of Positive Affect, Person-Job Fit, and Well-being on Job Performance

Our aims in this study were to examine the positive affect and person-job fit of team members and the effect of their sense of well-being on their job performance. Participants were 212 employees of 10 life insurance companies in Taiwan. We developed a survey to measure employees' positive affect, person-job fit, well-being, and job performance. Results showed that the employees' positive affect had a positive effect on both their sense of well-being and job performance, there was a highly significant positive correlation between person-job fit and well-being, and both well-being and person-job fit had positive effects on job performance. In addition, individuals' positive affect may have directly affected the quality of their job performance and well-being through the indirect effect of the quality of job performance, and person-job fit may have directly affected the quality of job performance, and indirectly affected the quality of job performance through well-being. Therefore, we suggested that managers should emphasize employee positive affect to increase individual employee sense of well-being, thus synchronizing job demands and individual capabilities to improve job performance.

Life Insurance Companies' Performance and Intellectual Capital: A long-term perspective

This study used dynamic data envelopment analysis (dynamic DEA) to evaluate the operating performance of life insurance companies in Taiwan and China. In addition, this study adopted panel data regression, which employs the cross-section and time-series approaches, to investigate the impact of intellectual capital (IC) on operating performance. The results indicated that the overall performance of life insurance companies in China was better than that of life insurance companies in Taiwan. Furthermore, in both countries, the performance of life insurance companies with local capital was better than that of companies with foreign capital. The results also showed that human capital (HC) and structural capital (SC) had impacts on the operating performance of life insurance companies. The potential applications and strengths of DEA in assessing the life insurance industries in Taiwan and China are highlighted.

Restricting weight flexibility in fuzzy two-stage DEA

Data envelopment analysis (DEA) is a method for measuring the efficiency of peer decision making units (DMUs). Recently DEA has been extended to examine the efficiency of two-stage processes, where all the outputs from the first stage are intermediate measures that make up the inputs to the second stage. Two-stage DEA models do not require a priori specification of input and output weights (or multipliers) and by letting these weights run freely, estimates of system and process efficiencies are obtained. This paper proposes a methodology for a fuzzy two-stage DEA model, where the weights are restricted in ranges and input–output data are treated as fuzzy numbers. The assurance region approach is utilized to restrict weight flexibility in the model. Based on Zadeh’s extension principle, a pair of two-level mathematical programs is formulated to calculate the upper bound and lower bound of the fuzzy efficiency score. We then transform this pair of two-level mathematical programs into a pair of conventional one-level mathematical programs to calculate the bounds of the fuzzy efficiency scores. The examples of non-life insurance companies in Taiwan and IT impact on firm performance are illustrated to calculate the system and process efficiencies and how to derive their relationship when the data is fuzzy.

The Determinants of Corporate Image for Life Insurers in Taiwan

Abstract This study attempts to analyze the relationship between corporate image and business operation of life insurance companies in Taiwan. Based on the performance indicators in underwriting and financial constructs, this study conducts regression analysis to find the influential factors for corporate image of life insurers. This study finds that both underwriting and financial operations have considerable impacts on the corporate image of life insurance companies. The results indicate that consumers evaluate the corporate image based on not only the financial performance but also the quality of underwriting management, such as services provided by the insurers. The company background (e.g. subsidiary of financial holding companies or foreign insurers) does not significantly influence the corporate image. The findings of this study suggest that the life insurance companies in Taiwan should pay more attention to the underwriting activities and service quality in order to enhance their corporate image.

Interval Efficiency of Two-stage Network DEA Model with Imprecise Data

The conventional data envelopment analysis (DEA) models assume that the data of inputs and outputs are exactly known. However, inputs and outputs can be in ordinal relations or bounded data, or fuzzy data, which have been studied under the DEA approach by using fuzzy for calculating interval efficiency results. The current paper studies the situation when imprecise data is incorporated into the two-stage network DEA model, and construct new models to obtain the lower and upper bounds of the interval efficiency scores. Unlike the fuzzy number-based models, our proposed approach is based on DEA-like linear models. This paper shows that DEA optimality results can always be achieved at the input and output bounds, while can not be achieved at the upper or lower bonds of intermediate variables. We apply the proposed models to evaluate a set of life insurance companies in Taiwan for illustrating the use of our models and the differences of its results from that of existing fuzzy number-based models.

Interval Efficiency of Two-stage Network DEA Model with Imprecise Data

The conventional data envelopment analysis (DEA) models assume that the data of inputs and outputs are exactly known. However, inputs and outputs can be in ordinal relations or bounded data, or fuzzy data, which have been studied under the DEA approach by using fuzzy for calculating interval efficiency results. The current paper studies the situation when imprecise data is incorporated into the two-stage network DEA model, and construct new models to obtain the lower and upper bounds of the interval efficiency scores. Unlike the fuzzy number-based models, our proposed approach is based on DEA-like linear models. This paper shows that DEA optimality results can always be achieved at the input and output bounds, while can not be achieved at the upper or lower bonds of intermediate variables. We apply the proposed models to evaluate a set of life insurance companies in Taiwan for illustrating the use of our models and the differences of its results from that of existing fuzzy number-based models.