How Does the Insurer's Mobile Application Sales Strategy Perform?

37 Pages Posted: 20 Dec 2021 Last revised: 16 Apr 2023

See all articles by An Chen

An Chen

Ulm University - Institute of Insurance Science

Yusha Chen

Ulm University - Department of Mathematics and Economics

Finbarr Murphy

University of Limerick - Kemmy Business School

Wei Xu

University of Limerick - Kemmy Business School

Xian Xu

Fudan University - School of Economics

Date Written: February 16, 2023

Abstract

While the impact of an Internet-based sales strategy on sales performance has been well studied, there is little academic research that examines the impact of a mobile application (MA) sales strategy on the sales performance of insurers. Using a unique data set for term life insurance policies from a Chinese life insurer, we study the impact of implementing this strategy on insurance purchases. We find significant growth in the insurance purchase quantity and somewhat lower growth in premiums received from new policies (PRNP). This paper determines that this is due to improved channel accessibility and the cost reduction of the MA channel. Although sales of traditional distribution channels are cannibalized in the short term by the MA distribution strategy, this substitution effect does not persist in the long run. In addition, we find that this strategy reduces impulsive purchases.

Keywords: Mobile Application, Insurance Distribution, Sales Performance, Heterogeneity Analysis

JEL Classification: G22, D12, M31

Suggested Citation

Chen, An and Chen, Yusha and Murphy, Finbarr and Xu, Wei and Xu, Xian, How Does the Insurer's Mobile Application Sales Strategy Perform? (February 16, 2023). Available at SSRN: https://ssrn.com/abstract=3985977 or http://dx.doi.org/10.2139/ssrn.3985977

An Chen

Ulm University - Institute of Insurance Science ( email )

Ulm, 89081
Germany

HOME PAGE: http://www.uni-ulm.de/mawi/ivw/team

Yusha Chen (Contact Author)

Ulm University - Department of Mathematics and Economics ( email )

Helmholzstrasse
Ulm, D-89081
Germany

HOME PAGE: http://https://www.uni-ulm.de/mawi/ivw/institut/team/yusha-chen/

Finbarr Murphy

University of Limerick - Kemmy Business School ( email )

Limerick
Ireland

Wei Xu

University of Limerick - Kemmy Business School ( email )

Limerick
Ireland

Xian Xu

Fudan University - School of Economics ( email )

600 GuoQuan Road
Shanghai, 200433
China

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