Why do lenient claims handling practices exist in the insurance industry? A survey study of ethical decisions by claims adjusters
Abstract
Purpose
The purpose of this paper is to investigate which factors will affect the insurance claims adjusters’ attitude and behavior intention toward lenient claims handling practices. These factors include organizational justice, behavioral-based control, significant others, and customer complaints.
Design/methodology/approach
Data are collected with questionnaires from full-time licensed insurance claims adjusters in Taiwan. Partial least squares method is used to test the hypotheses.
Findings
The main results show that significant others and organizational justice have significant effects on the claims adjusters’ attitude toward the lenient claims handling practices. Significant others and attitude have significant effects on the behavioral intention.
Originality/value
The influence of claims management on insurance companies’ operation is quite considerable. Poor claims management may not only harm insurance companies’ finance, but also affect the adjustment of future premiums. Yet, in reality, some claims adjusters are found to make flawed claims decisions. Very few studies discuss this problem. This study provides an initial step toward understanding this issue.
Keywords
Acknowledgements
This study was funded by the Ministry of Science and Technology of the Republic of China (Grant No. MOST 105-2410-H-035-016). The author declares no conflict of interest.
Citation
Tseng, L.-M. (2017), "Why do lenient claims handling practices exist in the insurance industry? A survey study of ethical decisions by claims adjusters", Managerial Finance, Vol. 43 No. 11, pp. 1254-1273. https://doi.org/10.1108/MF-02-2017-0050
Publisher
:Emerald Publishing Limited
Copyright © 2017, Emerald Publishing Limited