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The role of preventive services in the insurance industry purchasing decision
Type
conference paper
Date Issued
2010-06-21
Author(s)
von Watzdorf, Stephan
Abstract
Maintaining and advancing competitiveness through additional services is an accepted strategy in today's insurance business. Despite the plethora of supplementary offerings the significance of preventive products or services deserves particular attention. Safety trainings and emergency equipment do not only allow delivering additional value to the customer but provide a mean to select risk aware customers and reduce claims. The relevance of this strategy becomes apparent with the insurance industry striving for new strategies in order to handle price pressure and eroding premiums in many European countries. Despite the number of contribution in this area and product on the market it remains unclear how the provision of preventive services affects the customer's decision during the insurance purchasing process.
To close this research gap we conducted a conjoint analysis based on a motor insurance product in 2009. In addition to traditional product attributes such as the price, the franchise or no-claims bonus, additional driver safety training was included in the offer.
Based on the results we show that the provision of the driver safety training has a significant influence on the preference structure of the customers and hence on the purchasing decision. In a consecutive cluster analysis based on the individual preference values customer segments were found which revealed the differing influence of the safety training on the purchasing decision. The findings of this contribution show the influence of preventive services on the purchasing decision and provide practitioners with guidelines on how to target customer segments demanding such services
To close this research gap we conducted a conjoint analysis based on a motor insurance product in 2009. In addition to traditional product attributes such as the price, the franchise or no-claims bonus, additional driver safety training was included in the offer.
Based on the results we show that the provision of the driver safety training has a significant influence on the preference structure of the customers and hence on the purchasing decision. In a consecutive cluster analysis based on the individual preference values customer segments were found which revealed the differing influence of the safety training on the purchasing decision. The findings of this contribution show the influence of preventive services on the purchasing decision and provide practitioners with guidelines on how to target customer segments demanding such services
Language
English
HSG Classification
contribution to scientific community
Refereed
Yes
Book title
Risk, governance & accountability
Publisher
SRA Society for Risk Analysis
Start page
94
Event Title
19th Annual SRA Meeting of Society for Risk Analysis 2010
Event Location
London, King's College
Event Date
21.-23.06.2010
Subject(s)
Division(s)
Eprints ID
72174