South African short-term insurers operate in a highly competitive market but do not
successfully differentiate themselves from competitors. One way differentiation can be
achieved, is to adopt a customer-focused approach where short-term insurers engage in
CRM initiatives such as providing quality services and relational benefits to satisfy customer
needs and subsequently retain customers over the long term. This study investigates the
effect of service quality and relational benefits on customer satisfaction, as well as the effect
of customer satisfaction on behavioural intentions in the short-term insurance industry. A
quantitative, descriptive research design was followed and convenience sampling was used
to select respondents. Data was collected by means of self-administered surveys from shortterm
insurance customers in Gauteng, South Africa. The results of the structural equation
model indicate that service quality and relational benefits have a significant effect on
customer satisfaction, which in turn has a significant effect on customers’ behavioural
intentions. The paper also offers several managerial implications.
This article was co-written by P.G. Mostert before he joined the University of Pretoria.