ASSESSMENT OF SERVICE QUALITY AND ITS IMPACT ON CUSTOMER SATISFACTION: THE CASE OF OROMIA INSURANCE S.C.

Abstract

The aim of this study was to assess service quality and its impact on customer satisfaction in Oromia insurance company. This study is set out to examine the impact of service quality on customer satisfaction in selected branches of Oromia insurance S.C. by SERVQUAL model. It also shows the gaps between customer’s expectation and perceived performance on Oromia insurance company. The research was conducted using cross sectional survey and the primary data is collected through structured questionnaire developed based on SERVQUAL model. Convenience sampling technique was used to select 89 respondents from three branches of Oromia insurance located in Addis Ababa. The data has been analyzed, using descriptive statistics, gap analysis, Pearson’s correlation and regression analysis. The finding shows that all the five service quality dimensions are positively related with customer satisfaction. Assurance shows the strong positive relation with customer satisfaction. The result also indicates that the overall service quality perceived by consumers was not satisfactory meaning expectations exceeded perceptions and all the dimensions showed higher expectations than perceptions of services. The R square value described that 60% of variation in customer satisfaction is accounted by the service quality dimensions. To increase customer satisfaction Oromia insurance S.C should focus on improving service quality dimensions.