Impact of service quality on medical insurance firms and its effect on member satisfaction and loyalty: The case of CIMAS

Abstract

The main objective of this research was to determine the impact of service quality determinants on customer satisfaction and loyalty in the medical insurance industry in Zimbabwe using CIMAS as a case study. In today’s competitive and fast paced environment, customer loyalty has often been cited as a significant factor. Customer loyalty is beneficial to a company’s performance, medical aid societies like CIMAS included. The delivery of quality services leads to customer satisfaction hence enabling customer loyalty. This study focused on determining the service quality levels of companies in the medical insurance industry in Zimbabwe. The study used primary source of data which was gathered through questionnaires and analysed by Statistical Package for the Social Sciences (SPSS) SPSS is a software package used for statistical data analysis. It followed the qualitative approach which is exploratory in nature. The research used a inductive approach. A combined survey and case study research strategy and a questionnaire research method were employed to gather data from a random sample of 218 drawn from CIMAS members who visited its two branch offices in Harare, Zimbabwe. Seven determinants of service quality were extracted from the dataset with exploratory factor analysis and their impacts on customer satisfaction was measured with confirmatory factor analysis. All the factors remained important. Thereafter, the relationship between customer satisfaction and customer loyalty in CIMAS was measured with structural equation modelling. It was found there is a positive and significant correlation between customer satisfaction and customer loyalty. Recommendations drawn from the findings were for CIMAS management to adopt the gap model and implement strategies that will help in closing the gaps. CIMAS need to improve on the turnaround times in all areas. Finally, CIMAS need to maintain its loyal customer by recognizing them