The Influence Of Consumer Trust On Commercial Insurance Demand

Social trust is the lubricant of economic interaction and the most effective mechanism to supervise the implementation of contracts.From a macro perspective,the level of trust not only plays an irreplaceable role in the economic field,but also has an immeasurable impact on the long-term stability of the whole nation.At the micro level,a higher level of trust among internal members,consumers and companies is conducive to improving the company's comprehensive competitiveness in the market.In the process of economic development,trust,as an important social capital,determines the amount of social capital.Finance,by its very nature,has been associated with trust since its inception.Trust plays an important role in the financial field and is indispensable in any financial transaction.Insurance belongs to the financial industry,therefore,the role of trust can not be ignored,it will affect the commercial insurance needs of consumers.Consumer trust will affect consumers' insurance demand.This paper not only proves the influence from the mathematical Angle,but also proves it by the demonstration.Due to the special nature of insurance contracts,the development model of insurance companies,the overall image of the insurance industry,the level of family wealth,consumers' cultural awareness and values,the level of consumer trust in insurance is not high at this stage.Adam Smith,in his great work the wealth of nations,regarded the insurance mechanism as a mechanism to disperse losses,and believed that insurance is an economic behavior that relies on the whole society or a group to bear losses to mitigate the impact of losses.Apart from economics,psychology expert maslow's hierarchy of needs in 1988 build demand for insurance also made statements,he think that human needs on the whole is divided into seven levels,and the second level of security requirements belong to basic needs,including personal,family,property safety,and insurance is aimed at the lower level of demand arises at the historic moment.Both in the field of economics and psychology,the study of commercial insurance demand is very important.Article structure: the first part is introduction;The second part is an overview of consumer trust and commercial insurance needs.The third part is the mathematical reasoning of trust to insurance demand;The fourth part is data,variables and models.The fifth part is the empirical results and analysis of consumer trust on insurance demand;The sixth part is the conclusion and suggestion.In the first part of the introduction,it mainly introduces the possibility that consumer trust has an impact on the explanation of family participation in the insurance market under the background that the role of trust in the economic field is increasingly valued,but the level of consumer trust in the insurance industry is relatively low.This paper briefly reviews the domestic and foreign literatures on the influence of trust on economic decision-making behavior and the influence of family commercial insurance demand,and introduces the research methods,innovation points and shortcomings of this paper.In the second part combs the demand of consumer trust and commercial insurance related key points,has been clear about the trust,commercial insurance,business insurance demand concept,as well as the influencing factors of commercial insurance demand analysis of the trust as a kind of economic behavior of the impact of economic development,financial industry due to its special properties,it has been and trust from a hook.Trust plays an important role in the financial field and is indispensable in any financial transaction.Insurance belongs to the financial industry,therefore,consumer trust affects the family's demand for commercial insurance.Then it introduces the current development status of China's insurance industry and analyzes the reasons why consumers lack trust in commercial insurance.In the third part,according to the von neumann--morgenstein utility function,the policyholder's insurance purchase decision is to choose the optimal ? to maximize his expected utility.When ?=0,if the insured does not trust the insurance company completely,they will not buy insurance;If the insured person believes that the insurance company will pay with a probability greater than zero,they will purchase a certain amount of insurance.When ?=1,if the insured person fully believes that the insurance company will fulfill the contract,they will buy full insurance.And when policy-holder does not believe insurance company to be able to fulfil an agreement completely when,buy partial insurance only,can reduce insurance to buy thereby.We then discuss further the impact of changes in trust and risk levels on the level of insurance demand.In the fourth part of data,variables and models,the overall situation of 2013 survey data of China financial survey and research center(CHFS)of swufe is firstly introduced.Then the definition methods of the concerned variables,explained variables and control variables are described,and descriptive statistics of the overall sample and the control sample of the variables are carried out.Finally,the Probit model and Tobit model used in the empirical process are introduced,and the parameters in the formula are explained.In the fifth part the empirical results and analysis,first choose to trust a stranger,in the benchmark return of commercial endowment insurance trust,trust in government pension insurance of the arithmetic mean as a measure of consumer trust Probit model and empirical Tobit model was used to study the consumer trust to the influence of the family to participate in the insurance market behavior.The results show that consumer trust has a significant positive impact on the participation probability of family commercial insurance market and the logarithm of commercial insurance premium expenditure.In addition,the influence of consumer trust on commercial life insurance and commercial property insurance is analyzed.The results show that consumer trust has a significant positive impact on commercial life insurance and commercial property insurance,but the marginal impact on personal insurance is greater.Secondly,the robustness,heterogeneity and endogeneity of the baseline regression were tested.In the robustness test,in order to make the results more persuasive,this paper USES three methods to test by referring to the existing literature.The second method is to use the spousal family sample to generate the average trust between husband and wife as an index to measure consumer trust.Method 3: Tobit model was used to test the proportion of family business insurance premium in total family expenditure.The regression results show that the influence of consumer trust on the participation behavior of family commercial insurance market is still significantly and positively correlated,and the difference between urban and rural areas is consistent with the baseline regression,which further indicates that the baseline regression result is robust.In the heterogeneity analysis,this paper grouped the data according to education,total income,age,physical health,total assets and family size.The results showed that the significance was not affected by different samples,but the marginal effect was different.The endogenous analysis mainly discusses whether consumer trust and commercial insurance purchase affect each other.The sixth part is the conclusion of this paper and the corresponding Suggestions based on the regression analysis.By summarizing the foregoing contents and combining the research conclusions of this paper,this paper puts forward some tentative Suggestions from the perspectives of consumers,commercial insurance companies and the government on how to promote the participation of family commercial insurance market and improve the level of nationwide risk guarantee.They are as follows:Consumers should establish a correct concept of insurance and enhance their understanding and learning of commercial insurance.This requires consumers to have a certain degree of insurance literacy,in the basis of understanding,understanding the nature of insurance,in order to trust insurance,but more easily choose to meet their own needs of insurance products.Insurance companies need to improve consumers' trust in commercial insurance from three aspects.First,establish a professional insurance service team,reduce the loss rate of insurance personnel,do a good job in pre-sales and after-sales service,especially pay attention to the timely settlement of claims this link,timely settlement of claims,can improve the level of consumer trust in commercial insurance.Secondly,commercial insurance companies should choose easy-tounderstand language for sales and promotion to reduce the cost for consumers to obtain information and enhance their trust in insurance on the basis of understanding.Finally,by improving their own goodwill,insurance companies do a good job in advertising and public relations,improve the status of insurance in the minds of consumers.Finally,the Chinese government should also enhance consumers' trust in commercial insurance from three aspects.First,while improving the educational level of residents,we should also focus on the popularization of comprehensive insurance education,improve the insurance knowledge of consumers,and enable the whole people to establish correct risk awareness and insurance awareness,so as to enhance consumers' confidence in commercial insurance.Secondly,in the supervision of commercial insurance companies,insurance brokerage companies and agency companies,attention should also be paid to the existence of misleading sales behaviors of consumers due to the limitation of their own insurance knowledge.Third,the government should,according to its own credibility and influence,increase the publicity of insurance and improve consumers' confidence in commercial insurance.