Does commission disclosure affect consumer choice?
Type
working paper
Date Issued
2025-06-02
Author(s)
Hommel, Laurenz
Abstract
This study examines the impact of commission disclosure on consumer decision-making and trust in insurance intermediaries. Using two experimental studies in the DACH region, we analyze whether general or product-specific commission transparency influences purchasing behavior and perceptions of trust. Despite regulatory assumptions that increased transparency improves decision quality and trust, our findings indicate no significant effect of commission disclosure on consumer choices or trust in sales intermediaries. Reasons for this result could be behavioral factors such as information overload, limited insurance literacy and limited considered decision variables may limit the effectiveness of transparency measures. These insights raise critical questions for policymakers regarding the effectiveness of current transparency regulations and suggest that complementary measures, such as improved financial education and simplified product communication, may be necessary to support informed consumer decision-making.
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0_Paper_3 (1).pdf
Size
8.15 MB
Format
Adobe PDF
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