A Model for the Application of Financial Technology in the Development of the Electronic Insurance Industry Using Interpretive Structural Modeling (ISM)

Abstract

This study aimed to develop a structural model explaining the application of financial technology in the development of the electronic insurance industry by identifying key components and determining their hierarchical relationships, driving power, and dependence. An exploratory mixed-methods approach was employed. In the qualitative phase, 15 university academics and experts in insurance and financial technology with at least 15 years of relevant professional experience were recruited through purposive and snowball sampling, and semi-structured interviews continued until theoretical saturation. The qualitative data were analyzed using phenomenological thematic analysis in MAXQDA 20. Trustworthiness was assessed according to Guba and Lincoln’s criteria, while Holsti’s inter-coder agreement and Cohen’s kappa were 0.717 and 0.659, respectively. In the quantitative phase, 40 managers and experts in the insurance industry and financial technology were included through census sampling. Interpretive Structural Modeling (ISM) was used to determine hierarchical relationships among the constructs, and MICMAC analysis was employed to assess their driving and dependence powers. The intraclass correlation coefficient for the structural modeling procedure was 0.802. ISM revealed a six-level hierarchical structure. Technology-access limitations arising from sanctions constituted the most fundamental driver, with a driving power of 12 and dependence of 1. Technological infrastructure and the role of legal and regulatory institutions each showed a driving power of 10 and dependence of 3 and, together with digital culture, formed the principal driving layer. Financial technology and the competitive structure of the insurance industry occupied Level 3, whereas product diversity, financial transparency, and financial risk management were positioned at Level 4. Customer trust and insurance penetration constituted Level 5. Financial sustainability, with a dependence power of 12 and driving power of 1, occupied Level 6 and emerged as the most dependent and ultimate outcome of the model. Sustainable development of electronic insurance follows a structural chain extending from environmental, institutional, and technological drivers through operational mechanisms to market-oriented outcomes. Accordingly, reducing technology-access constraints, strengthening technological infrastructure and regulatory mechanisms, and fostering digital culture should precede initiatives aimed at improving customer trust, insurance penetration, and financial sustainability.