The Journal of Asian Finance, Economics and Business

Korea Distribution Science Association (한국유통과학회)
권호 표지
DOI QR코드

DOI QR Code

Critical Factors Affecting Customers' Purchase Intention of Insurance Policies in Indonesia

  • Received : 2020.11.05
  • Accepted : 2021.01.08
  • Published : 2021.02.28
Download PDF
⟨ Previous Next ⟩

Abstract

The purpose of this study was to analyze the influence of product quality factors, product risk, company reputation, and service quality on the purchase intention of insurance policies by customers in Indonesia. The variables in this study are product quality, service quality, company reputation, perceived risk, and purchase intention. This study uses a quantitative approach. Primary data were obtained from 154 respondents. Data processing and model testing use the Structural Equation Modeling procedure with Lisrel 8.80. At the significance level of 0.05, the research found that product quality had a positive and significant effect on purchase intention; product quality had a positive and significant effect on company reputation; product quality had a positive and significant effect on perceived risk perception; company reputation had a positive and significant effect on purchase intention; company reputation has a positive and insignificant effect on service quality; product quality has a positive, but non-significant effect on service quality; service quality has a positive and significant effect on purchase intention; perceived risk has a negative and significant effect on purchase intention; perceived risk has a positive and significant impact on service quality; and perceived risk has a positive and significant effect on company reputation.

Keywords

References

  1. Abdel, F. F. A., Rahman, M. S., & Osman, M. (2015). Assessing the Antecedents of Customer Loyalty on Healthcare Insurance Products: Service Quality; Perceived Value Embedded Model. Journal of Industrial Engineering and Management, 8(5), 1639-1660.
  2. Abdullah, D., Nailul, M. A., & Rozario, F. (2009). Influence of Service and Product Quality towards Customer Satisfaction: A Case Study at the Staff Cafeteria in the Hotel Industry. Journal World Academy of Science, Engineering and Technology, 53, 185-190.
  3. Agyapong, A., AfiJoel, D., & Kwateng, K. O. (2018). Examining the effect of perceived service quality of health care delivery in Ghana on behavioural intentions of patients: The mediating role of customer satisfaction. International Journal of Healthcare Management, 11(4), 276-288. https://doi.org/10.1080/20479700.2017.1326703
  4. Andaleeb, S. S., & Conway, C. (2006). Customer satisfaction in the restaurant industry: an examination of the transaction-specific model. Journal of Service Marketing, 20, 3-11. https://doi.org/10.1108/08876040610646536
  5. Anderson, J. C., & Narus, J. A. (1990). A model of distributor firm and manufacturer firm working partnerships. Journal of Marketing, 54(1), 42-58. https://doi.org/10.1177/002224299005400103
  6. Atinga, R. A., Abekah, N. G., & Domfeh, K. A. (2011). Managing healthcare quality in Ghana: a necessity of patient satisfaction. International Journal of Health Care Quality Assurance, 24(7), 548-563. https://doi.org/10.1108/09526861111160580
  7. Bicen, P. (2015). Consumer Perceptions of Quality, Risk, and Value: A Conceptual Framework. In: H. E. Spotts (Ed.), Revolution in Marketing: Market Driving Changes (pp. 1-1). London, UK: Springer International Publishing.
  8. Bitner, M. J., & Hubbert, A. R. (1994). Encounter Satisfaction Versus Overall Satisfaction Versus Quality. In: R. T. Rust & R. L. Oliver (Eds.), Service Quality: New Direction in Theory and Practice (pp. 72-94), Thousand Oaks, CA: Sage Publications.
  9. Bolton, R. N., & Drew, J. H. (1991). A Multistage Model of Customer's Assessments of Service Quality and Value. Journal of Consumer Research, 17(4), 375-384. https://doi.org/10.1086/208564
  10. Bong, S., Sugiarto, Lemy, D. M, Nursiana, A., & Arianti, S. P. (2019). Risk, Crisis and Disaster Management for a Sustainable Tourism Industry. Jakarta, Indonesia: PT. Gamedia Pustaka Utama.
  11. Bravo, R., Montaner, T., & Pina, J. M. (2009). The role of bank image for customers versus non-customers. International Journal of Bank Marketing, 27(4), 315-334. https://doi.org/10.1108/02652320910968377
  12. Cabral, L. (2000). Stretching Firm and Brand Reputation. The Rand Journal of Economics, 31(4), 658-74. https://doi.org/10.2307/2696353
  13. Caruana, A. (2002). Service loyalty: The effects of service quality and the mediating role of customer satisfaction. European Journal of Marketing, 36(7/8), 811-828. https://doi.org/10.1108/03090560210430818
  14. Chen, H. S., Tsai, B. K., & Hsieh, C. M. (2017). Determinants of Consumers' Purchasing Intentions for the Hydrogen-Electric Motorcycle. Journal Insurance Sustainability, 9, 1447. https://doi.org/10.3390/su9081447
  15. Cho, M., Bonn, M. A., & Kang, S. (2014). Wine attributes, perceived risk and online wine repurchase intention: The cross-level interaction effects of website quality. International Journal of Hospitality Management, 43, 108-120. https://doi.org/10.1016/j.ijhm.2014.09.002
  16. Dipin, M., & Ashish, T. (2014). Factors Influencing Customer's Choice for Insurance companies - A Study of Ajmer City. IOSR Journal of Business and Management, 16(2), 35-43.
  17. Elgin, A., & Nedunchezhian, V. R. (2012). An Analytical Study into the Effects of Service Quality on the Perception of Domestic Airline Image with Special Reference to Frequent Fliers at Trivandrum City in India. European Journal of Social Sciences, 29(4), 521-527.
  18. Famiyeh, S., Asante, D., & Kwarteng, A. (2018). Service quality, customer satisfaction, and loyalty in the banking sector. International Journal of Quality & Reliability Management, 35(8), 1546-1567. https://doi.org/10.1108/IJQRM-01-2017-0008
  19. Faullant, R., Matzler, K., & Fuller, J. (2008). The impact of satisfaction and image on loyalty: the case of Alpine ski resorts. Managing Service Quality, 18(2), 163-178. https://doi.org/10.1108/09604520810859210
  20. Ganesan, S. (1994). Determinants of long-term orientation in buyer-seller relationships. Journal of Marketing, 58, 1-19. https://doi.org/10.1177/002224299405800201
  21. Gardener, E., Howcroft, J., & Williams, J. (1999). The new retail banking revolution. The Service Industries Journal, 19(2), 83-100. https://doi.org/10.1080/02642069900000020
  22. Gatti, L., Caruana, A., & Snehota, I. (2012). The role of corporate social responsibility, perceived quality and corporate reputation on purchase intention: Implications for brand management. Journal of Brand Management, 20(1), 65-76. http://dx.doi.org/10.1057/bm.2012.2
  23. Giovanis, A. N., & Tsoukatos, E. (2017). An integrated model of the effects of service evaluation, corporate image, and switching barriers on customer loyalty. Journal of Transnational Management, 22(1), 4-24. https://doi.org/10.1080/15475778.2017.1274612
  24. Gundersen, M. G., Heide, M., & Olsson, U. H. (1996). Hotel Guest satisfaction among Business Travellers: What Are the Important Factors? The Cornell Hotel and Restaurant Administration Quarterly, 37(2), 72-81. https://doi.org/10.1016/0010-8804(96)83104-1
  25. Guru, P., & Umamaheswari, D. (2018). An Empirical Investigation to analyse the Factors influencing the Consumer Perception regarding Life Insurance policies using Path Analysis, International Journal Supply Chain Management, 7(5), 927-932.
  26. Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2009). Multivariate Data Analysis (7th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.
  27. Harridge-March, S. (2006). Can the building of trust overcome consumer perceived risk online? Marketing Intelligence & Planning, 24, 746-761. https://doi.org/10.1108/02634500610711897
  28. Hong, B., & Cha, S. H. (2013). The mediating role of consumer trust in an online merchant in predicting purchase intention. International Journal of Information Management, 33, 927-939. https://doi.org/10.1016/j.ijinfomgt.2013.08.007
  29. Iliyasu, Z., Abubakar, I. S., & Abubakar, S. (2010). Patients' satisfaction with services obtained from Aminu Kano Teaching Hospital, Kano, Northern Nigeria. Niger Journal of Clinical Practice, 13(4), 371-378.
  30. Kim, D. J., Ferrin, D. L., & Rao, H. R. (2007). A trust-based consumer decision-making model in electronic commerce: The role of trust, perceived risk, and their antecedents. Decision Support System, 44, 544-564. https://doi.org/10.1016/j.dss.2007.07.001
  31. Klongthong, W., Thavorn, J., Watcharadamrongkung, S., & Ngamkroeckjoti, C. (2020). Determination of Factors in Cultural Dimensions and SERVQUAL Model Affecting the Corporate Image of Pharmacy Retail Stores. Journal of Asian Finance, Economics and Business, 7(10), 875-884. https://doi.org/10.13106/jafeb.2020.vol7.no10.875
  32. Koufaris, M., & Hampton, S. W. (2004). The development of initial trust in an online company by new customers. Information & Management, 41, 377-397. https://doi.org/10.1016/j.im.2003.08.004
  33. Kumar, V., & Shah, D. (2004). Building and sustaining profitable customer loyalty for the 21st century. Journal of Retailing, 80, 317-330. https://doi.org/10.1016/j.jretai.2004.10.007
  34. Lai, F., Griffin, M., & Babin, B. J. (2009). How quality, value, image, and satisfaction create loyalty at a Chinese telecom. Journal of Business Research, 62, 980-986. https://doi.org/10.1016/j.jbusres.2008.10.015
  35. Li, S. C. (2013). Exploring the relationships among service quality, customer loyalty and word of-mouth for private higher education in Taiwan. Asia Pacific Management Review, 8(4), 375-389.
  36. Liu, C. M., & Huang, C. J. (2014). Relational benefits, customer satisfaction, and customer loyalty in chain store restaurants. The International Journal of Organizational Innovation, 7(1), 46-56.
  37. Liu, B. S., Sudharshan, D., & dan Hamel, L. O. (2000). After service response in service quality assessment: real time updating model approach. Journal of Service Marketing, 14(2), 160-177. https://doi.org/10.1108/08876040010321000
  38. Luo, X., & Homburg, C. (2007). Neglected Outcomes of Customer Satisfaction. Journal of Marketing, 71(2), 133-149. https://doi.org/10.1509/jmkg.71.2.133
  39. Masoud, E.Y (2013). The Effect of Perceived Risk on Online Shopping in Jordan. European Journal of Business and Management, 5(6), 76-87.
  40. Mirabi, V., Akbariyeh, H. & Tahmasebifard, H. (2015). A Study of Factors Affecting on Customers Purchase Intention Case Study: the Agencies of Bono Brand Tile in Tehran. Journal of Multidisciplinary Engineering Science and Technology, 2(1), 267-273.
  41. Murkherjee, A., & Nath, P. (2007). Role of electronic trust in online retailing: A re-examination of the commitment-trust theory. European Journal of Marketing, 41(9/10), 1173-1202. https://doi.org/10.1108/03090560710773390
  42. Nguyen, N. D., & Leblanc, G. (2001). Corporate image and corporate reputation in customers' retention decisions in services. Journal of Retailing and Consumer Services, 8, 227-36. https://doi.org/10.1016/S0969-6989(00)00029-1
  43. Oliver, R. L. (1980). A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions. Journal of Marketing Research, 17, 460-469. https://doi.org/10.1177/002224378001700405
  44. Oliver, R. L. (1999). When Consumer Loyalty? Journal of Marketing, 63(Special Issue), 33-44. https://doi.org/10.1177/00222429990634s105
  45. Olorunniwo, F., Hsu, M. K., & Udo, G. J. (2006). Service quality, customer satisfaction and behavioural intentions in the service factory. Journal of Services Marketing, 20(1), 59-72. https://doi.org/10.1108/08876040610646581
  46. Ostrowska, D. A. (2019). Consumer protection policy in the Polish life insurance market in the aspect of current legal regulations. Investment Management and Financial Innovations, 16(4), 168-180. https://doi.org/10.21511/imfi.16(4).2019.15
  47. Palmatier, R. W., Scheer, L. K., & Steenkamp, J. B. E. M. (2007). Customer Loyalty to Whom? Managing the Benefits and Risks of Salesperson-Owned Loyalty, Journal of Marketing Research, 44(2), 185-199.
  48. Parasuraman, A., Valarie A. Zeithaml dan Leoanard L. Berry (1994). Reassessment of expectations a comparison standard in measuring service quality: Implication for further research. Journal of Marketing, 58(January), 111-124.
  49. Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A multiple item scale for measuring consumer perceptions of service quality. Journal of Retailing, 64, 12-40.
  50. Pavlou, P. A. (2003). Consumer acceptance of electronic commerce: Integrating trust and risk with the technology acceptance model. International Journal of Electronic Commerce, 7(3), 197-226.
  51. Peter, J. P., & Ryan, M. J. (1976). An investigation of perceived risk at the brand level. Journal of Marketing Research, XIII, 184-188. https://doi.org/10.1177/002224377601300210
  52. Sandeep, C. (2016). Consumer Perception regarding Life Insurance Policies: A Factor analytical Approach. Pacific Business Review International, 9(6), 52-61.
  53. Sebjan, U. & Tominc, P. (2015). Conceptual Model of Relationships Among Customer Perceptions of Components of Insurance Service. South East European Journal of Economics and Business, 10(1), 32-44. https://doi.org/10.1515/jeb-2015-0002
  54. Siddiqui, Masood, H., & Sharma, T. G. (2010). Analyzing customer satisfaction with service quality in life insurance services. Journal of Targeting, Measurement and Analysis for Marketing, 18, 3/4, 221-238 https://doi.org/10.1057/jt.2010.17
  55. Sirdeshmukh, Deepak, Jagdip, S., & Barry, S. (2002). Consumer Trust, Value, and Loyalty in Relational Exchanges. Journal of Marketing, 66(1), 15-37. https://doi.org/10.1509/jmkg.66.1.15.18449
  56. Steenkamp, J. B. E. M. (1990). Conceptual Model of the Quality Perception Process, Journal of Business Research, 21(4), 309-333. https://doi.org/10.1016/0148-2963(90)90019-A
  57. Szymanski, D. M., & Henard, D. H. (2001). Customer satisfaction: A meta-analysis of the empirical evidence. Journal of Academic of Marketing Science, 29, 16-35. https://doi.org/10.1177/0092070301291002
  58. Tham, K. W., Dastane, O., Johari, Z., & Ismail, N. B. (2019). Perceived Risk Factors Affecting Consumers' Online Shopping Behaviour. Journal of Asian Finance, Economics and Business, 6(4), 249-260. https://doi.org/10.13106/jafeb.2019.vol6.no4.249
  59. Tran, V. D. (2020). The Relationship among Product Risk, Perceived Satisfaction and Purchase Intentions for Online Shopping. Journal of Asian Finance, Economics and Business, 7(6), 221-231. https://doi.org/10.13106/jafeb.2020.vol7.no6.221
  60. Tran, V. D., & Le, N. M. T. (2020). Impact of Service Quality and Perceived Value on Customer Satisfaction and Behavioral Intentions: Evidence from Convenience Stores in Vietnam. Journal of Asian Finance, Economics and Business, 7(9), 517-526. https://doi.org/10.13106/jafeb.2020.vol7.no9.517
  61. Ulaga, W. (2003), Capturing Value Creation in Business Relationships: A Customer Perspective. Industrial Marketing Management, 32, 677-93. https://doi.org/10.1016/j.indmarman.2003.06.008
  62. Umamaheswari, G. P. D. (2019). A study on Factors Deciding Selection of Policies of Private Life Insurance Companies among Consumers in Thanjavur District. International Journal of Recent Technology and Engineering, 7(6S2), 45-48.
  63. Umamaheswari, G. P. G. (2019). Consumer Buying Behaviour towards Life Insurance Policies in Thanjavur City. International Journal of Recent Technology and Engineering, 8(2S4), 727-730. https://doi.org/10.35940/ijrte.B1146.0782S419
  64. Vijaya, R. M. (2016). A Study on Consumer Behavior Towards Life Insurance Products With Reference To IDBI Fortis Company Limited, Dindigul District. International Journal of Applied science, 6(8), 2016.
  65. Wang, Y., & Hazen, B.T. (2016). Consumer product knowledge and intention to purchase remanufactured products. International Journal of Production Economics, 181, 460-469. https://doi.org/10.1016/j.ijpe.2015.08.031
  66. Weedige, S. S., Ouyang, H., Gao, Y., & Liu, Y. (2019). Decision Making in Personal Insurance: Impact of Insurance Literacy. Journal Insurance Sustainability, 11(23), 6795. https://doi.org/10.3390/su11236795
  67. Wen-yeh, H., Holly, S., & Alan, J.D. (2004). Effect of brand name on consumers risk perceptions in online shopping. Journal of Consumer Behavior, 4(1), 40-50. https://doi.org/10.1002/cb.156
  68. Wijanto, S. H. (2008). Structural Equation Modeling. Graha Ilmu, Indonesia: Edisi Pertama.
  69. Wu, P. C. S., Yeh, G. Y. Y., & Hsiao, C. R. (2011). The effect of store image and service quality on brand image and purchase intention for private label brands. Australasian Marketing Journal, 19(1), 30-39. https://doi.org/10.1016/j.ausmj.2010.11.001
  70. Xu, J., Gong, Y., & Liu, Z. (2005). Study of corporate reputation's impact on customer loyalty. Foreign Economics and Management, 7, 44-50.
  71. Yang, Q., Pang, C., Liu, L., Yen, D. C., & Tarn, J.M. (2015). Exploring consumer perceived risk and trust for online payments: An empirical study in China's younger generation. Computers in Human Behavior, 50, 9-24. https://doi.org/10.1016/j.chb.2015.03.058
  72. Yoon, S., & Lee, C.-K. (2014). Examining th Relationships among the Crowding, Perceived Risk, Satisfaction, Trust, and Support in a Festival Site: The Case of the Seoul Lantern Festival. Journal of Hospitality and Tourism Studies, 16(6), 337-357.
  73. Zhang, Z., & Hou, Y. (2017). The effect of perceived risk on information search for innovative products and services. Journal of Consumer Marketing, 34, 241-254 https://doi.org/10.1108/JCM-04-2016-1768
  74. Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996) The behavioral consequences of service quality. Journal of Marketing, 60, 31-46. https://doi.org/10.1177/002224299606000104
  75. Zeithaml, V. A. (1988). Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence. Journal of Marketing, 52(July), 2-22. https://doi.org/10.1177/002224298805200302
  76. Zikmund, W., & Scott, J. (1973). A Multivariate analysis of perceived risk, self confidence and information sources. Advances in Consumer Research, 1, 406-416.
  77. Zuelseptia, S., Rahmiati, & Engriani, Y. (2018). The Influence of Perceived Risk and Perceived Ease of Use on Consumer's Attitude and Online Purchase Intention. Advances in Economics, Business and Management Research, 57, 384-390.

Cited by

  1. The Influence of Customer Trust and Loyalty on Repurchase Intention of Domestic Tourism: A Case Study in Thailand During COVID-19 Crisis vol.8, pp.5, 2021, https://doi.org/10.13106/jafeb.2021.vol8.no5.0961
  2. Predicting the Intention and Purchase of Health Insurance Among Malaysian Working Adults vol.11, pp.4, 2021, https://doi.org/10.1177/21582440211061373