Assurance Versus Insurance: A Study of Consumer Receptiveness in an E-Commerce Setting

Posted: 30 Nov 2007

See all articles by El'fred Boo

El'fred Boo

Nanyang Business School, Nanyang Technological University

Kin-Yew Low

Nanyang Technological University - Nayang Business School

Xinming Soh

Credit Suisse; CFA Institute

Miaoling Lim

Deutsche Bank

Abstract

Periodic examination is a critical feature for assurance but not insurance; accordingly insurance is potentially a lower-cost alternative to assurance. Unlike assurance, however, whether insurance inspires consumer confidence remains an unexplored empirical question. This paper compares consumer receptiveness to the concepts of assurance and insurance in an e-commerce setting. Results (n=360) in a controlled experiment indicate equivalent consumer receptiveness to assurance and insurance; both significantly increase purchasing intention. Results further indicate that consumer preference for CPA versus non-CPA insurance providers depends on consumers' assurance knowledge. High-assurance knowledge consumers prefer insurance provided by insurance companies while low-assurance knowledge consumers prefer insurance provided by CPA firms. Our finding suggests that the CPA profession could potentially leverage its brand name in a service area outside the profession's traditional markets. An extension to our study assesses the feasibility of CPAs providing insurance service solely or in collaboration with insurance companies.

Keywords: Assurance and insurance concepts, CPA brand name, online purchasing intention

JEL Classification: M49, G22

Suggested Citation

Boo, El'fred Hian Yong and Low, Kin Yew and Soh, Xinming and Soh, Xinming and Lim, Miaoling, Assurance Versus Insurance: A Study of Consumer Receptiveness in an E-Commerce Setting. Accounting Horizons, Vol. 21, No. 4, 2007, Available at SSRN: https://ssrn.com/abstract=1029492

El'fred Hian Yong Boo (Contact Author)

Nanyang Business School, Nanyang Technological University ( email )

Singapore, 639798
Singapore

Kin Yew Low

Nanyang Technological University - Nayang Business School ( email )

S3-B2a-18
Nanyang Avenue
Singapore, 639798
Singapore
(65)67904903 (Phone)
(65)67924217 (Fax)

Xinming Soh

Credit Suisse ( email )

CRTI 4
P.O. Box
Zurich, CH-8070
Switzerland

CFA Institute ( email )

915 East High Street
Charlottesville, VA 22902
United States

Miaoling Lim

Deutsche Bank ( email )

31 West 52nd Street, 12th Floor
New York, NY 10019
United States

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