Marketing Channel, Corporate Reputation and Profitability of Life Insurers: Evidence of Bancassurance in Taiwan

Abstract

This paper investigates the impact of marketing channels on the corporate reputation and profitability of life insurers based on the evidence of bancassurance in Taiwan. The empirical result indicates that marketing through bancassurance reduces underwriting service quality and thus negatively affects the insurer’s reputation. On the other hand, bancassurance shows an advantage in that it cuts business expenses and consequently contributes to the insurer’s profitability. This paper also finds a positive and sustained relationship between corporate reputation and profitability. Furthermore, the impact of bancassurance on service quality, corporate reputation and profitability increases with market maturity. The overall result suggests that life insurers must pay attention to service quality when marketing through bancassurance, as service quality has a sustained effect on corporate reputation and therefore profitability.