Corporate reputation, salesperson trustworthiness and customer loyalty in the life insurance industry

This study analyses the effects of corporate reputation and trustworthiness in the salesperson on the customer loyalty of 215 German customers who obtained endowment insurance. We use a cross-sectional study design. Corporate reputation is captured by the rational attitude of competence and the emotional likeability of the insurer by customers. The results show that perceived likeability and trustworthiness in the salesperson both play an equally dominant role in customer satisfaction and loyalty followed by perceived core service quality. Surprisingly the competence level has no direct effect on customer loyalty. Our results show that a trustworthy salesperson can compensate for weaknesses in a company's perception of competence. Finally, the results suggest that life insurers' strategic management should focus on strong emotional bonds and the formation of a trustful sales force. Assistance services can offer customers an early positive product experience, usually within the year-long saving phase of a life insurance product. Our findings underscore the need for insurers to be perceived as innovative, fair, socially engaged, and being represented by a highly trusted salesperson to achieve high levels of customer loyalty.