THE EFFECTS OF MOTOR INSURANCE SERVICE QUALITY ON CUSTOMER SATISFACTION: THE CASE OF NILE INSURANCE S.C

Abstract

The purpose of this study was to examine the effects of Motor Insurance service quality on customer satisfaction in Nile insurance company, Addis Ababa branches only. To meet the objective the study used descriptive and explanatory, research design with quantitative and qualitative research approach. In addition, questionnaires and interview were the primary data gathering tools for this study; 362 respondents filled up the questionnaire properly and used to conduct the study. The study employed simple random sampling techniques and the collected data were analyzed using descriptive statistic and inferential statistics (correlation and regression analysis) using statistical package for social science (SPSS) version 21.The research finding showed, the independent variables (tangibility, reliability, responsiveness, assurance and empathy) have positive relationship with customer satisfaction. From those, tangibility and empathy had positive and strong correlation with customer satisfaction for the value of r = 0.724 and 0.733 respectively. This correlation finding supported by regression finding; based on the finding, empathy and tangibility have greater impacts (statistically moderate effects) on customer satisfaction with the value of β = 0.377 and 0.331 respectively. On the other hand, assurance, reliability and responsiveness were statistically less or insignificant effect on customer satisfaction with the value of β = 0.280, 0.193 and 0.151 respectively. Customers perception towards insurance service and company service delivery are relatively well and carry out based on contracts but delaying of service provision, indemnity long process, absence of spare parts in the market and cost variation, lack of well-organized information, absence of awareness, crane and poor documentation are the challenges that are faced service provision. As a result, the company needs effective and efficient insurance service and also established well organized awareness creation mechanism and information system to reduced information gap and avoid unnecessary practice during clam notification or indemnity.