The Impact of Customer Service on Customer Retention in Insurance Companies. The Case of One life Assurance Zambia Limited

Abstract

In many industries, the role of customer service is widely acknowledged as pivotal in maintaining customer loyalty and satisfaction. This importance is particularly pronounced in the insurance sector, where the primary product offered is intangible. As noted by Susskind (2003), customer service plays a crucial role in customer retention within this industry. This research aims to explore the intricate relationship between customer service and customer retention, focusing specifically on Onelife Assurance Limited. The study employed a sample size of 203 participants and pursued four distinct objectives. Firstly, it aimed to assess how the efficiency of claims processing impacts customer retention. Secondly, it sought to evaluate the correlation between responsiveness to customer queries and the fostering of customer loyalty. Thirdly, the research aimed to measure customer satisfaction levels in relation to policy renewals. Lastly, it aimed to provide actionable recommendations for enhancing customer service, thereby bolstering customer retention. Primary data for this study was collected through a survey methodology. The collected data underwent thorough analysis and was presented using various charts generated using Microsoft Excel. The findings of this research highlighted the direct influence of customer service on customer satisfaction and loyalty within the insurance industry. It was evident that investing in superior customer service is essential for meeting the expectations of insurance clients. Satisfied customers are not only more likely to exhibit loyalty through repeated business but also contribute positively to word-of-mouth marketing based on their positive experiences with service quality. In conclusion, this study underscores the critical role of customer service in the insurance sector, emphasizing its impact on both customer satisfaction and retention. By prioritizing customer service excellence, companies can cultivate enduring relationships with their clientele, thereby enhancing overall business performance and competitiveness in the market.