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Journal of Emerging Markets and Management

An Assessment on Service Quality in the Ethiopian Insurance Industry: A PLS-SEM Analysis

DOI:

https://doi.org/10.63385/jemm.v2i2.101059

Keywords:

Service Quality,Customer Satisfaction,SERVQUAL,PLS-SEM,Ethiopia

Abstract

This study presents a rigorous quantitative investigation of the determinants of customer satisfaction in the Ethiopian insurance sector, grounded in the Service Quality (SERVQUAL) model. The research analyzes empirical data using Partial Least Squares Structural Equation Modeling (PLS-SEM) to evaluate information gathered from completed structured questionnaires provided by policyholders and industry professionals. The investigation examines factors grouped into five distinct service quality dimensions, including tangibility, reliability, responsiveness, assurance, and empathy. The findings indicate that tangibility, reliability, responsiveness, and assurance have a statistically significant positive influence on customer satisfaction. However, the results indicate that empathy has an insignificant effect on overall satisfaction among the participants. This study offers significant theoretical value by validating the SERVQUAL framework in the Ethiopian context and highlighting a functional priority paradox in which risk-reduction dimensions outweigh relational dimensions in emerging markets. The findings also provide vital practical guidance for Ethiopian insurance companies and the National Bank of Ethiopia by establishing a strategic imperative to prioritize technical competence, rapid service delivery, and tangible infrastructure. By focusing on these core strengths, institutions can better secure long-term policyholder loyalty and operational success in a market characterized by operational rigidity and bureaucratic challenges. Furthermore, the study suggests that addressing these service gaps is essential for the modernization of the domestic financial landscape and the improvement of general trust in insurance products.

References


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    Copyright (c) Copyright © 2026 Mubarek Sadik, Abdo Dabaso Jaldesa , Garbicha Duba Wako

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    This work is licensed under a Creative Commons Attribution 4.0 International License.

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