Project Abstract

Abstract
The insurance industry plays a crucial role in mitigating risks for corporate entities, offering a wide range of insurance products tailored to meet the specific needs of businesses. Understanding the factors that influence corporate insurance buyers in selecting insurance companies is essential for insurance providers to effectively target and serve their corporate clients. This research project aims to explore and analyze the key determinants that impact the choice of insurance companies among corporate insurance buyers. The study will employ a mixed-methods approach, combining quantitative surveys and qualitative interviews to gather comprehensive data on the preferences and decision-making processes of corporate insurance buyers. The research will focus on factors such as the reputation and financial stability of insurance companies, the quality of customer service, the range of insurance products offered, pricing competitiveness, and the extent of coverage provided. Additionally, the study will examine the influence of insurance brokers and intermediaries, as well as the role of technological advancements in the insurance industry on the decision-making process of corporate insurance buyers. Through in-depth interviews with corporate risk managers, insurance procurement officers, and other relevant stakeholders, the research aims to uncover the underlying motivations and considerations that drive the selection of insurance companies by corporate entities. The qualitative data will provide valuable insights into the priorities and preferences of corporate insurance buyers, shedding light on the aspects that hold significant weight in their decision-making process. Furthermore, the quantitative surveys will allow for the collection of structured data that can be analyzed statistically to identify trends, correlations, and patterns in the choice of insurance companies among corporate buyers. By combining both qualitative and quantitative methods, this research project seeks to offer a comprehensive understanding of the multifaceted factors that shape the decisions of corporate insurance buyers when selecting insurance providers. The findings of this study are expected to contribute to the existing body of knowledge on corporate insurance buying behavior and provide valuable insights for insurance companies looking to enhance their offerings and services for corporate clients. Ultimately, a deeper understanding of the factors influencing the choice of insurance companies among corporate buyers can help insurance providers tailor their strategies to better meet the evolving needs and preferences of the corporate insurance market.

Project Overview

INTRODUCTION
1.1   BACKGROUND TO THE STUDY
The advent of insurance industry in Nigeria could be traced to the British colonial trading companies that established agency offices in Nigeria, on behalf of insurance companies in UK. After the Nigerian political independence of 1960, indigenously owned insurance companies sprang up with lot of inadequacies, like lack of capital, valuation of risk selection and poor claims management. These inadequacies of capital coupled with lack of technical and managerial skill, poor service delivery, poor insurance regulatory framework, brought confidence crisis and strong apathy to insurance purchase in Nigeria as corporate buyers of insurance look for better service (Augustine and Bamidele, 2013).

The services provided by the insurance companies are almost similar in nature and type and thus the customers are exposed to diversified choices. This means that there are unlimited switching choices and /customers will choose the alternative that gives him maximum satisfaction in references to different factors that differentiate insurance benefit from each other (Mathur and Tripathi, 2014). High level of competition is the most important factor in influencing the structure and activities of the insurance system around the globe. More and more insurance facilities are made available in every part of the country even to small cities, towns and rural areas. With the growing awareness among the people and businesses about insurance, various services provided by the companies and availability of insurance facilities across the globe, the insurance sector is emerging very rapidly and there is a need to identify the main factors that affect customer’s choice for a particular insurance company (Mathur and Tripathi, 2014).

Moreover, the success of a service company is immensely dependent on the availability and quality of their services to the consumers and thus is inextricably bound up with price/cost (Rajkumar and Kannan, 2014). According to insurance marketing theory the choice of insurance companies or products to be adopted by buyers could be influenced by many factors. Petra (2012) posited that factors, like cost, service quality, customers’ satisfaction, products’ features, payment of claims are some of the factors that influence corporate buyers to pick an insurance company. In view of this, an insurance company designing its marketing strategy must be based on the full knowledge of factors influencing consumers' purchase behavior and the factors that affect consumers' decisions on the selection of an insurance company (Rajkumar and Kannan, 2014).

Literature has shown that the quality of services and the achievement of customer satisfaction and loyalty are fundamental for the survival of insurers. The quality of after sales services, in particular, can lead to very positive results through customer loyalty, positive word-of-mouth, repetitive sales and cross-selling. However, many insurers appear unwilling to take the necessary actions to improve their image (Wang & Lo, 2002). This creates problems for them as the market is extremely competitive and continuously becomes more so (Taylor, 2001). Understanding the factors that determine the choice of insurance companies among corporate insurance buyers and creating demand is essential in facilitating the success of insurance services (Razak and Kasim, 2014). Hence, this research study will examine the factors that determine the choice of insurance companies among corporate insurance buyers in Lagos State Nigeria.

1.2   Statement of the Problem

Making a choice or choosing an insurance company by corporate insurance buyer may be affected by a number of factors depending on the nature of the product and the considered utility derivable from it. And for a corporate insurance buyer, the demand for insurance arises from the satisfaction that a consumer gains from the increase in financial security achieved by transferring the risk of loss to an insurer.

Delivering quality service is considered an essential strategy for success and survival in today's competitive environment (Dawkins and Reichheld, 1990). Insurance sector is one of the most important entities which have been growing relatively in the past decade in Nigeria. With a greater choice among corporate insurance buyers in Lagos State and an increasing awareness, there is now a continuous increase in the customers’ expectations and they demand better quality service. Therefore, for insurance companies to sustain in the market, service quality andcustomers’ satisfaction becomes the most critical component of competitiveness for insurance companies in Nigeria.

With increasing demands among corporate insurance buyers, insurance sector has become competitive. Customers are becoming increasingly aware of their expectations and thus demand higher standards of services, as technology is enabling them to make comparisons quickly and accurately. Their perceptions and expectations are continually evolving, making it difficult for insurance providers in Nigeria to measure and manage services effectively. It has been observed that there is widespread customer dissatisfaction in the insurance industry (Omar, 2005), arising from poor service design and delivery, and inferior quality of services largely account for this.

Researches linking quality of service and choice of insurance companies among corporate insurance buyers in developing countries, Nigeria inclusive have shown that insurance services seem not to have been so accepted enthusiastically in developing countries. The abysmal level of consumers’ perception and ultimate demand for insurance products in developing economies has attracted relative interests among researchers and practitioners alike. It is against this backdrop that this study seeks to examine the factors that determine the choice of insurance companies among corporate insurance buyers in Lagos State Nigeria with a special reference to First Bank Nig Plc and Union Bank Plc.

1.3 Objectives of the Study

The major objective of this study is to explore the factors that determine the choice of insurance companies among corporate insurance buyers. While other specific objectives include;

1. To examine the effect of service quality on choice of corporate insurance buyers.

2. To assess the impact of price on demand for insurance policy.

3. To investigate the relationship between customers’ satisfaction and business purchase of insurance products.

1.4   Research Questions

The undertaking of this study will be guided by the following research questions;

1. What is the effect of service quality on choice of corporate insurance buyers?

2. To what extent is price related to demand for insurance policy?

3. What is the relationship between customers’ satisfaction and business purchase of insurance products?

1.5   Research Hypotheses

In the course of this study the following research hypotheses will be tested:

Ho1: There is no significant relationship between service quality and choice of corporate insurance buyers.

Ho2: There is no significant relationship between price and demand for insurance policy.

Ho3: Customers’ satisfaction is not related to business purchase of insurance products