The number of companies in the professional service sector making use of two or more channels
of distribution to market their products is increasing steadily. This strategy has become the
dominant channel design; nonetheless, research in the area of channel choice in professional
services is quite limited. This study contributes to this topic by examining antecedents of channel
choice in services, with a focus on the insurance sector in Saudi Arabia. The study adopts a
quantitative research method and a value-based framework to examine the survey responses of
84 corporate customers in Saudi Arabia who provided information regarding their channel choice
decisions when purchasing insurance. The study examines the impact of three key explanatory
variables (i.e. product class knowledge, perceived transaction risk, and task complexity) in
relation to perceived broker channel value, and the latter in relation to broker channel choice.
Research findings provide evidence that product class knowledge and perceived transaction risk
influence perceived broker channel value, and that increased perceived broker channel value
leads to greater intentions of broker channel usage.
From a business standpoint, the results of this study reassert the importance of gaining
knowledge on what drives consumers in their choice of channels. This will allow insurance
managers to better align their products and services to serve the needs of different customer
segments, and in the process, minimizing channel conflict often present in multichannel
developing markets. Results also stresss the need for insurance brokers, and particularly brokers
in developing insurance markets, to focus on value creation beyond the traditional “supplier” role
involving quotations soliciting and pricing negotiations. Moreover, insurance companies must
acknowledge that insurance brokers provide a crucial function in the client-insurer relationship
development. As a result, continuous support and collaboration between brokers and insurance
companies needs to continue for both to thrive and excel in competitive, highly evolving
insurance markets.