FACTORS AFFECTING MOTOR INSURANCE CLAIM PROCESSING TIME: THE CASE OF AWASH INSURANCE COMPANY S.C.

Abstract

The aim of this research was examining the factors that affect motor insurance claim processing time in Awash Insurance Company S.C. The study has analyzed the effect of selected independent variables, which are assumed to have major impact on motor insurance claims processing time. The variables: competency of claims staff, customers’ awareness of motor policy and competency of service providers were selected. The researcher used both primary and secondary sources of data. As a primary source, the relevant data was gathered from customers of AIC, who had motor own damage claims previously through structured questionnaire that has four demographical and twenty three close-ended questions. Questionnaires were dispatched to 134 conveniently selected customers from top 10 motor claim paid branches in the year 2017/18, and 117 or 87.3% returned. For data analysis and interpretation, quantitative and qualitative research approaches are used and to show the cause and effect relationship between variables, explanatory research design was used. The collected data was analyzed with the help of SPSS version 20. Regression analysis was used to investigate the impact of independent variables on dependent variable. Major findings from the regression result of the research showed that competency of service providers are found to be the most significant factor in affecting motor insurance claims processing time in AIC. Next to competency of service providers, competency of claims staff has an impact on motor claims processing time. Customers’ awareness of motor policy was found to have no significant impact on process. Based on these findings, a recommendation which can facilitate motor insurance claims processing time to increase customer satisfaction has been forwarded. Therefore, the need for careful selection of garages based on the skilled manpower they have; punctuality to deliver; and quality of work are suggested. Furthermore, intensive training for claims staff in relation to customer handling; and underwriters need to disclose the contents of the policy up on underwriting are recommended.