An efficiency comparison of direct and indirect channels in Taiwan insurance marketing

Purpose The purpose of this paper is to compare the efficiency of bancassurance, an indirect marketing channel formed through the creation of subsidiaries, with an insurer's own team, a direct marketing channel, in the Taiwan insurance sector. Design/methodology/approach This paper uses the Charnes, Cooper, and Rhodes (CCR) model to measure the decision‐making units' (DMU) operating efficiency. Findings The three major findings are: the efficiency score of a direct marketing channel is significantly higher than that of a comparable indirect marketing channel. The efficiency relationship between the indirect marketing channel and the direct marketing channel is independent. A marketing efficiency evaluation, when divided into different marketing channels for evaluation, provides meaningful results for marketing decision‐makers. Originality/value By comparing the efficiency between two different insurance marketing channels, managers in life insurance companies can make a more informed choice.