Asia Pacific Journal of Information Systems (APJIS)

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Current Issue

Date	December 2021
Vol. No.	Vol. 31 No. 4
DOI	https://doi.org/10.14329/apjis.2021.31.4.527
Page	527~542
Title	The Impact of Insurance Contract on Insurance Complaint Ratios through Text Analysis
Author	Jeongkwon Seo, Woojin Yang, Hyejin Mun, Chul Ho Lee
Keyword	Incomplete Contract Theory, Consumer satisfaction, Ambiguity, Insurance Contract
Abstract	The government-driven open data policies are on the rise to protect consumers from misunderstandings and monitor the companies. However, in contract-based industries such as insurance, the contract-inherent characteristics make information asymmetry between consumers and companies. Our paper focuses on insurance contracts the contingency has high uncertainty of occurrence, and the clauses may incur high costs of reading. Given those contracts, we hypothesized that the contract’s clear statement decreases customer dissatisfaction and lowers the number of complaints. To empirically support the claim, we collected customers’ complaint documents of insurance companies and insurance contracts from 2005 until 2017. Our econometric models showed that clearer statements and words significantly reduce the complaints after controlling for firm-specific heterogeneity and time-specific heterogeneity. We identify that insurance companies’ complaint ratio significantly differ depending on the insurance contract, including specific clauses and words.