Effect of Service Quality Features on Customer Retention: The Case of Ethiopian Insurance Corporation
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Date
2021-09
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A.A.U
Abstract
This study attempts to emphasize the rising importance of customer retention, and how it is
affected by Service Quality. In the Service Quality model, the five identified criteria called
Service Dimensions influencing customer retention through customers' perceptions of service
are, (1) Assurance, (2) Tangibles, (3) Responsiveness, (4) Empathy and (5) Reliability.
Customers typically use these criteria to judge the quality of service they receive. Demonstrating
the relationship between these five service dimensions and customer retention at the Ethiopian
Insurance Corporation, is the focal purpose of this study.
Accordingly, sample for the study consisted of 254 customers from the Ethiopian Insurance
Corporation's Southern Addis District. Data were collected with the help of questionnaires and
analyzed using the Statistical Package for the Social Science (SPSS) version 20; service
dimensions being the study's independent variables, and Customer Retention, the dependent
variable. The results of the study indicated that all Service Dimensions (Tangibles, Assurance,
Responsiveness, Empathy and Reliability) positively and statistically affected customer
retention.
The various identified components of each of the Service Dimensions that directly affect
Customer Retention, do not seem to be given the due attention they deserve by the EIC's
management at all levels of the Corporation. This study therefore, recommends that the
Corporation's management give this issue its exclusive attention, so as to ensure much improved
profit levels through improved performances
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Keywords
Service Quality, Customer Service, Customer Retention, and Customer Satisfaction