Islamic influence on customer satisfaction: evidence from Takaful and conventional insurance industry

Abstract

Purpose

This paper aims to identify Islamic influence on customer satisfaction in Pakistan Takaful and conventional insurance industry. Specifically, it analyses the vital role of Shari’ah perception in achieving higher customer satisfaction.

Design/methodology/approach

The data from 400 customers of both the family Takāful and life insurance (200 each) were collected. Further, the regression-based bootstrapping approach was applied through process macro developed by Hayes (2013).

Findings

The results indicate that a higher Shari’ah perception positively affects the customer satisfaction in the Takaful industry with improved service and relationship quality; whereas, it negatively affects customer satisfaction in case of the conventional insurance. Further, it has been found that customer satisfaction partially mediates the customer switching intentions in both the Takaful and conventional insurance industry in the presence of service quality and relationship quality.

Practical implications

This research will enable the practitioners to understand the factors that affect customer satisfaction in Pakistan. It has the essential policy and managerial implications for the growth of the Takaful and conventional insurance industry.

Originality/value

This is one of the pioneer studies investigating the impact of Islamic influence (specifically Shari’ah perception) on customer satisfaction in both the Takaful and conventional insurance industry in Pakistan.

Citation

Akhter, W., Jamil, H. and Fam, K.-S. (2021), "Islamic influence on customer satisfaction: evidence from Takaful and conventional insurance industry", Journal of Islamic Accounting and Business Research, Vol. 12 No. 4, pp. 524-543. https://doi.org/10.1108/JIABR-05-2020-0148