Chapter 3: How AI-driven Chatbots Shape Corporate Reputation: The Interplay of Information Asymmetry and Communication Quality in the Insurance Industry

This study investigates the impact of artificial intelligence (AI)-driven chatbots on corporate reputation in the insurance industry, focusing on how information asymmetry (IA) and anticipated communication quality (ACQ) mediate and moderate these effects. As the insurance sector shifts from a traditional loss-compensation model to a more proactive risk-prediction approach, AI technologies such as chatbots are becoming integral. However, these technologies can introduce reputational risks (RRs) due to IA. The objective is to examine how chatbot experiences (CEs) influence corporate reputation in the insurance industry, with particular attention to the mediating role of IA and the moderating role of ACQ. Data were collected from a sample of 385 insurance clients across 5 out of 9 insurance companies in Palestine (West Bank) that use chatbot applications. A structured online questionnaire and convenience sampling were employed. The data were analyzed using structural equation modeling (SEM). The findings revealed that CE significantly influences IA, ACQ moderates the relationship between CE and IA, and IA mediates the effect of CE on reputational damage. Moreover, IA directly influences a company’s reputational damage. These results provide valuable theoretical and practical insights for insurance companies aiming to mitigate RRs linked to AI technologies.