Determinants of telemarketer misselling in life insurance services

Purpose - The purpose of the article is to present and test a model regarding important factors that may help reduce unethical behavior (i.e. misselling) of salespeople in the financial services industry. Design/methodology/approach - To test the hypotheses, telemarketers from the life insurance industry in South Korea were surveyed (n = 204). Findings - Using structural equation modeling, the results indicate that: ethics training is positively related to salesperson ethical attitude; ethical climate is positively related to salesperson ethical attitude; selling pressure is unrelated to ethical attitude; competitive intensity is positively related to salesperson ethical attitude; competitive intensity is unrelated to misselling; and misselling is inversely related to salesperson ethical attitude, positively associated with product complexity, and positively related to product variety. Research limitations/implications - Future empirical work could: investigate different variables from those utilized in this study; consider intercountry and gender differences; use alternate sources of data to examine stability of the findings; and employ samples of firms in other industries and other marketing channels. Limitations include a limited number of study variables, use of solely the telemarketing channel for life insurance, a preponderance of female respondents, and potential for socially desirable responses. Practical implications - Management should seek to maintain a high ethical attitude among sales agents to help foster a reduction in unethical behavior. Sales personnel should receive extensive ethics training to help enhance their ethical attitude in the job. Salespeople should also seek to establish and maintain long-term relationships with their customers and to pursue long-term profitability. Sales managers should seek to educate consumers about the various types of financial products, their respective strengths and weaknesses, and the appropriate conditions under which they should be purchased. Originality/value - The potential for financial services industry salespeople to behave unethically has received extensive research attention. A key area, though, which has been virtually ignored is antecedents of misselling of financial services. The article seeks to address partially this gap in the literature.