Strategic Innovative Responses Adopted By General Insurance Firms To Elevate Low Insurance Service Penetration And Performance In The Local Industry

Abstract

Firms need to define their mission and vision and develop strategies that will ultimately result in competitive advantage (Pearce and Robinson 2003). A firm’s survival in a changing and turbulent business environment is attached to its ability and capability to effectively and efficiently manage its resources relative to its strengths and weaknesses, explore opportunities and meet threats in the market place in its external environment. Porter (1985) indicates that a firm can shape its competitive position and industry attractiveness; firms can better or destroy its standing in the industry through the strategy it adopts. Competitive Innovative strategy then responds to environmental demands and attempts to fit with environment pressures relative to the firms resources; this constitutes the edge of competitive advantage. The greater importance for penetration of insurance in general and life aspects has been emphasized by various surveys in the economic sense of it. Penetration of Insurance has remained quite low in developing countries. Organizations need to act past tackling impediments currently experienced to increasingly improve the conditions that are always changing in the industry (Drucker 1993). Low insurance penetration can be attributed to many factors ranging from ignorance, religious beliefs, and negative perception of insurance related products, limited insurance channel structure, and low incomes. Several theories can be advanced for this study, the popular ones being the resource based view which identifies firms competencies in terms of unique application and strengths. The proponents of the resource based view thus give more emphases to resources than capability (Muthui 2015). The other relevant theory to the study is the contingency theory. The theory emphasis on the firm’s best way to utilize its resources relative to its social set up and environment. The theory proposed by Lawrence &Lorsh (1967) indicates that the theory addresses issues that are experienced in the execution of change programmes to enhance the quick penetration processes within the industry. Another relevant theory to study is the service quality of Gaps Model. This theory examines the causes of gaps on the part of the providers and tends to close these gaps so that the customer gaps will be eventually closed. The theory will give critical highlights on reasons of low services penetration takes place in the industry. Finally the Porters (1980) five forces model is quite relevant in the understated study. The theory examines the implementation of a competitive strategy in terms of industry opportunities and constraints. The study will adopt a descriptive cross sectional research design. A descriptive research design is conclusive and aims to describe the happening associated with a subject or estimate proportions. The study examines the who, what, where and how phenomenon. The descriptive attempts to describe possible behavior attitude, values and characteristics, Mugenda (2003). A descriptive research as the name implies aims to describe the characteristics of the population under study Queen (1999). The study will target all the 35 firms in general insurance business hence will do a census. The primary data will be utilized. The data will be collected using questionnaires. The questionnaires will be administered through drop and pick method; emailed; the respondents will be senior executives in charge of marketing /operations/customer services and general claims. Data will be analyzed using descriptive statistics. The results will be exhibited in form of charts, pie charts/graphs, figures and diagrams.