The Mediating and Moderating Roles of Customer Expectation and Insurance Regulations on the Relationship Between Strategic Decisions and the Competitive Insurance Market Dynamics in Kenya

Abstract

This study sought to establish the mediating effect of customer expectations and the moderating effect of insurance regulations on the relationship between Strategic Decisions and Competitive Insurance Market Dynamics in Kenya. The adopted a multi-stage sampling technique involving census, purposive, and cluster sampling to identify the 62 insurance companies and the chief executive officers and the 385 insurance customers. The study adopted an Ordinal Regression Model to examine the direct relationship between the predictor and the criterion variables while the relationship between the outer and inner model variables was analysed using the G-SEM Model, more particularly the Structural Equation Model-Partial Least Squares model and internal consistency tested using a test re-test method. The results of the study confirmed a positive direct effect of strategic decisions on the competitive insurance market dynamics. Further results also noted that customer expectations had a positive mediating role in the relationship between strategic decisions and competitive insurance market dynamics in Kenya while insurance regulations had a negative moderating role in the relationship between the predictor and criterion variable. The study provided comprehensive empirical evidence on the value and efficacy of modelling effects of strategic decisions on competitive insurance market dynamics in Kenya.