QUO VADIS, EMOTIONS IN CONSUMER INSURANCE DECISIONS?

Most consumer loyalty studies in insurance focus on thinking processes, and largely ignore emotional influences. A study is conducted that investigates the relative contributions of thinking versus feeling on the desire to be loyal to an automobile insurer after a poor service experience. Three hundred and fifteen respondents were presented scenarios with different responses to an advertisement inviting consumers to switch insurers after their "poor" service experience. These different scenarios varied general price- and brand-related marketing influences to investigate their influence on anticipated regret as an emotion. We found that anticipated regret, as an emotion, contributes to consumer loyalty decisions to an insurer (specifically after a poor service experience). The results support the conclusions that (1) both thinking and feeling are important to consumer loyalty decisions in the context of car insurance, (2) male and female customers may differ in the mix of thinking and feeling influences on consumer loyalty decisions, and (3) insurance modelers of consumer loyalty decision-making processes should include marketing-related brand and price perceptions influences in analyses. Failure to do so can lead to poor prediction of consumer loyalty decisions because of the action versus inaction effects associated with anticipated regret.

For consumer insurance modelers and marketing researchers, the reported study presents evidence suggesting the importance of not ignoring emotions and feelings-related considerations in models of consumer loyalty within automobile insurance contexts. This implication is consistent with the theory that concludes that optimization of experience is the ultimate goal of human decision making, and that the greatest experienced utility involves both thinking and feeling.

For insurance marketers, the results highlight the risk of not considering both group differences in customer bases and contextual marketing influences (like price and brand perceptions differences) in efforts to understand consumer loyalty to insurance brands. The results further suggest that insurance marketers (1) consider measuring emotions like anticipated regret in their surveys of their customer base, and (2) engage in future research activities that build upon the results reported in this study to better understand how to mitigate and manage emotions like regret in their marketing practices.

Taylor, Steven A. (2013), "Affect and marketing stimuli in consumer loyalty decisions to automobile insurers," Journal of Financial Services Marketing (2013) 18, 4 – 16.