Investigating the impact of service quality and customer satisfaction on customer loyalty in life insurance in South Africa

Abstract

Service quality and satisfaction are very important concepts that companies must understand to remain competitive and grow (Angelova & Zekiri, 2011:232). Satisfied customers form the foundation of any successful business as customer satisfaction leads to repeat purchase, brand loyalty and positive word of mouth (Tsoukatos & Rand, 2006:501). The quality of service and the achievement of customer satisfaction and loyalty are fundamental for the survival of insurers (Taylor, 2001:30). Insurance companies are seeking to increase customer satisfaction and loyalty through improved service quality (Siddiqui & Sharma, 2010:171). The aim of this study is to examine the concepts of service quality, customer satisfaction and customer loyalty and their relationships with the goal of establishing greater clarity on the path of the relationship flow at Metropolitan in the life insurance industry in South Africa. 398 Metropolitan customers from the Customer Walk-in-Centres completed a structured questionnaire through computer assisted telephonic interviews (CATI). The analysis revealed that customer satisfaction mediates the relationship between perceived service quality and customer loyalty for customers from the Customer Walk-in-Centres of Metropolitan in South Africa. The results and findings provide extra information concerning customer's needs, wants and satisfaction for Metropolitan.