Effects of perceived cost, service value, and corporate image on the

behavioural intentions of customers in the Healthcare Insurance Industry in

Delhi-NCR.
Ms Khushboo
PhD. Research Scholar
Department of Management & Commerce
Manav Rachna University, Faridabad
Dr Rashi Banerji
Assistant Professor
Department of Management & Commerce
Manav Rachna University, Faridabad, Haryana

Abstract: Numerous developments in the health insurance and healthcare industries

have hampered the expansion of health insurance as a healthcare financing method
in India. The present study investigates the effects of cost/service price perceptions
on behavioural intentions and brand preferences (as moderated by customer
satisfaction). It also determines the influence of perceived service value as well as
the corporate image on brand preference and customer behavioural intentions. This
study shows that happy consumers acquire a brand preference for the insurers that
provide them with good services.This research adds to the body of knowledge in this
field by demonstrating the favourable influence of perceived service costs on brand
selection in the Indian healthcare insurance sector.This study addresses a
knowledge vacuum by examining if a mediating impact of customer satisfaction
exists in India’s healthcare insurance sector, and if so, how powerful it is.Both the
healthcare insurance business and the general public benefit from the research.

Keywords: Healthcare Insurance, Perceived cost, Service value, Corporate

image, Customer Satisfaction, Brand Preference

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 1. Introduction
One of the most essential components of the healthcare management system is
health insurance. (Yellaiah and Ramakrishna, 2012). However, during the last
decade, numerous developments in the health insurance and healthcare industries
have hampered the expansion of health insurance as a healthcare financing method
in India. The Indian health insurance business is fiercely competitive, and insurance
firms can obtain a competitive edge by focusing on crucial success criteria. (Kumar
and Duggirala, 2021).
Furthermore, most health insurance policies are one-year contracts, and customers
must renew their policies each year to stay in the insurance pool. Understanding the
factors that influence demand for health insurance and renewal decisions is critical
for the insurance industry's future growth and development. Customer satisfaction is
one of the many variables that influence a policyholder's choice to renew his or her
policy. (Bhat and Jain,2007).
Customers may also have various choices in terms of health insurance policy type,
coverage, sum insured, hospitalisation benefits, inclusions, and exclusions. This also
covers whether a buyer is prepared to pay a higher price for a product due to its
perceived brand value, exclusivity, or quality.
Product price that appeals to both the target consumer and the intermediaries
engaged in selling the health insurance policy is another aspect that is critical in
making judgments about buy intentions for a health insurance policy.
In light of this, the goal of this study is to accomplish the following objectives:

2. Research Objectives

The present study aims to fulfil the following objectives:

1. To investigate the effects of cost/service price perceptions on behavioural

intentions and brand preference (as moderated by customer satisfaction).

2. To determine the influence of perceived service value on brand preference and

customer behaviour.

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3.To investigate the impact of the connection between brand image and behavioural
intentions of health insurance customers.

3. Review of Theory and Empirics

We conducted a thorough evaluation of the relevant research to achieve the

aforementioned goals.
The review was carried out by categorising the research papers according to the
variousresearch objectives that we will be evaluated in the current study.

3.1 Evaluation of the effects of service price perceptions on behavioural

intentions and brand preference
By examining the link between service quality, satisfaction, and behavioural
intentions in Ayurveda, (Suhail and Srinivasulu, 2020) tried to identify the perceived
variations of healthcare customers in Ayurveda. The initial survey of 404
respondents (primarily women patients) revealed that, exceptfor education,
healthcare consumers' perceptions of service quality and patient satisfaction varied
according to socio-economic factors.It was also mentioned that in Ayurveda
healthcare, the power of client happiness plays a vital part in the link between
performance-based service quality and behavioural intents. Simply put, more loyal
healthcare customers can only be gained through improving service delivery quality
and increasing patient satisfaction.
Another study, conducted by Wong et al. (2014), looked at the impact of customer
satisfaction on customer loyalty in the Hong Kong healthcare insurance industry.
Customer loyalty in the health insurance industry is allegedly influenced by
satisfaction, brand preference, and switching costs, according to the authors.
Customer satisfaction was discovered to have a favourable direct influence on
customer loyalty as well as brand preference. As a result, brand preference has a
direct beneficial impact on consumer loyalty. The research findings give
management of Hong Kong's healthcare insurance carriers new and helpful insights
that will help them better understand their consumers.
In a study of 624 respondents, Abu-Salim et al. (2017) looked at the influence of
service pricing on consumers' perceptions of service quality and service-continuance
intentions. It summarises the findings of empirical research that looked at the effects
of service cost, service quality, and customer satisfaction on health insurance
customers' behavioural intentions to stay with or leave their current service
providers. Although highly happy health insurance clients are more likely to keep
their existing service providers, consumer discontent does not always result in

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discontinuation.The findings have some practical implications for health insurance
executives, including techniques for lowering attrition and increasing client retention.

3.2 The influence of perceived service value on customer satisfaction and the
brand preference
According to Johnson and Weinstein (2004), ‘by continually offering greater
perceived value to the relevant consumers, a significant competitive advantage may
be obtained.' The perceived value may also be produced when client expectations
and product/service standards are aligned.
Although the link between customer happiness and service quality has been studied
in a variety of industries, the influence of the relationship between perceived value
and loyalty has largely been overlooked from a health insurance standpoint
(Peterson, 2004).As a result, it's more important than ever to grasp the nature of
service attributes concerning consumers' perceived value of healthcare insurance
products.
The participants of the National Health Insurance Office Malang branch, (Wijaya et
al., 2020) were examined to look into the impacts of service quality on perceived
value mediated by brand image and brand trust. Using a purposive sample of 170
people, it was discovered that service quality has a substantial impact on the ability
to trust and brand image, and perceived value had a big impact on brand image.
Brand image somewhat mediates the influence of service quality on trust, while
perceived value entirely mediates the effect of trust. This study concludes that the
Malang branch of the Social Security Administration must maintain and improve the
quality of its services, as well as promote and socialise brand trustworthiness.

Another study (Chou et al, 2019) looked at the elements that impact Chinese-
speaking patients' happiness and loyalty in the medical care business. The impact of
five aspects of Service Quality, namely corporate image, perceived value, and trust,
on customer satisfaction and loyalty, was investigated. The answers of 406 Chinese-
speaking patients who used Thai medical services were studied using structural
equation model analysis. The results indicated that the image of a medical institution
has a substantial beneficial impact on five aspects of service quality. The research
ended with several recommendations for potential changes that can be created
following the company's image and service quality.
In Egypt, (Mohsen et al. 2018) looked studied the impact of several aspects of
perceived value on customer engagement and loyalty using an integrative
framework. The findings indicated that perceived value had a beneficial influence on
behavioural intentions. In addition, numerous health care facilities have implemented

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an active method for accepting complaints and involving clients in the resolution
process. The study's sample selection was defined narrowly, which was one of its
weaknesses. The bulk of the participants were male university students under the
age of 25.As a result, future researchers should concentrate their efforts on
researching female customers of healthcare institutions in Egypt.

3.3 The relevant connection between the brand image and behavioural
intentions of the health insurance customers

In the services business, brand preference is still a relatively unexplored area of

research. In the case of healthcare insurance, this lack of focus is especially evident.
Because of the sector's intangibility and subjectivity in valuing and evaluating quality,
branding is particularly important in the service industry. The insurance industry has
spent a lot of money on branding initiatives like intense customer engagement
through agents, advertisements, brochures and publicity literature, sponsored
programmers, and social media activities to develop and enhance customer
awareness and hopefully influence their preferences.To put it another way, client
happiness with insurance services drives brand preference.
In light of this, (Cham et al, 2016) investigated the effects of word-of-mouth and
social media on hospital brand image in one of their research. The authors also
sought to investigate the links between brand image, perceived service quality,
patient satisfaction, and behavioural intention. The structural study revealed that
both word-of-mouth and social media created by the hospital had a substantial
influence on brand image.Furthermore, the hospital brand image has a beneficial
impact on medical tourists' perceptions of service quality, and their perceptions of
service quality are strongly linked to their pleasure, which leads to their behavioural
intention.

Another research looked at and measured the quality of treatments given by private
hospitals in Bhopal, central India, as well as their results (patient satisfaction and
behavioural intentions) (Murti et. al., 2017). Multiple regression was used to explore
the connections between the creation of a comprehensive scale for assessing
service quality, patient satisfaction, and behavioural intentions in the health care
setting. It was determined that service quality had a direct impact on behavioural
intentions, with customer satisfaction serving as a mediating factor in affecting
behavioural intentions.In the context of health care services in India, service quality
and patient satisfaction have been proven to be important drivers of behavioural
intentions.

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 Based on the research objectives, we developed a conceptual model for the current
study based on this complete evaluation of studies.
4. Conceptual Model

Conceptual Approach: Figure 1

Independent / Input Variables

 PERCEIVED OUTCOME VARIABLES

SERVICE
PRICE/ COST CUSTOMER  BRAND
SATISFACTION PREFERENCE
 PERCEIVED  BEHAVIOURAL
SERVICE INTENTIONS
VALUE

 CORPORATE/
BRAND IMAGE

Moderating Variable

The above figure portrays the conceptual model of the present study.
In this study, we shall be looking at the impact of the service cost or price
perceptions of the health insurance on the brand preference as well as the
behavioural intentions of the customers of the health insurance (moderated by the
customer satisfaction variable.)
Secondly, we shall also be looking at the perceptions of the service value on the
brand preference and behavioural intentions of the customers of health insurance.
(moderated by customer satisfaction.)
Also, from the above review of theory, it is clear that the corporate or brand image of
the health insurance company also plays a significant role in deciding the brand
preference as well as the behavioural intentions of the customers.
The outcome variables assumed in our study are:
Brand Preference and behavioural intentions.

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 5. Research Methodology

The research design is the researcher's plan, as it lays out the technique for
gathering data and drawing meaningful conclusions from it.
Customers who have already used health insurance services in hospitals with
various levels of illness and disease make up the population. Personal sources,
insurance company databases, and hospital patient databases will all be used to
gather information.
Design of the Study: A descriptive research design will be used, in which the
study's hypotheses will be experimentally evaluated.
We attempted to explore the following hypothesis in this study:
Hypothesis of Research
H1a: Serviceprice fairness has a positive impact on customer satisfaction and
the behavioural intentions of the customers.
H1b: Service Value significantly influences the behavioural intentions of the
customers.
H1c: Brand image positively impactscustomer satisfaction and behavioural
intentions.

Sampling Method: In the context of hospitals, the following approaches would be

used to choose the sample involvement of customers towards medical insurance:
Two-stage:
For the study, we will first pick commercial and public health insurance providers. To
assure sample representativeness, use a non-probability quota sampling approach
based on geography and other characteristics.
Within the specified insurance firms, the simple Sampling technique will be used to
choose responders.
Sample Size: Based on statistical methodologies, at least 300 customers using
health insurance at hospitals in Delhi's National Capital Region.
Questionnaire Design: A structured questionnaire was developed based on talks with
various end-users, consumers, and literature reviews. The questionnaire had around
30 questions, and the responses were graded on a scale that was appropriate for the
situation.

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Based on statistical methodologies, insurance facilities at hospitals in Delhi's
National Capital Region.

6. Analysis

The SPSS programme (version 26) was used to analyse the data gathered for this
investigation. The various research objectives of the present study have been
analysed as follows:

6.1 The effects of cost/service price perceptions on behavioural intentions and

brand preference for health insurance(as moderated by customer satisfaction).
To test Hypotheses 1a, a regression analysis was used to test hypothesised
relationships between the variables. The effects of the service price perceptions
were seen on the behavioural intentions and the brand preference.

Table 1:Regression Analysis of the Variables( Outcome Variable: Brand Preference)

Overall Model Results

Adjusted R2 0.42

R 0.69

Standard error 0.52

Dependent Brand
variable Preference

Standard Standardized
error coefficients
Independent Coefficient t (df = 243) p-value
variables s

Intercept 0.14 0.56 0.67 0.90 0.02

Service Price 0.34 0.07 2.89 0.39 0.51
Perceptions
Perceived 0.18 0.05 1.65 0.56 0.08
Service Value
Customer 0.45 0.04 3.67 0.45 0.72
Satisfaction

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Above table 1 shows the results of the regression analysis. The correlation
coefficient value R is 0.69. This shows a high positive correlation among the
variables. Given the dependent variable as brand preference and the
independent variables as Service Price Perceptions, Perceived Service Value
and Customer Satisfaction, the table clearly shows the high positive coefficient
values of the independent variables (given the significant p-values).

Table 2: Regression analysis of the model (Outcome Variable: Behavioral

Intentions)

Adjusted R2 0.56

R 0.64
Std. Error 0.98
Dependent Behavioural
variable Intentions

Standar Standardised
d error coefficients
Independent Coefficients t (df = 250) p-value
variables

Intercept 0.14 0.53 -0.67 0.78 0.01

Service Price 0.34 0.27 4.87 0.00 0.98
Perceptions
Perceived
0.45 0.23 3.67 0.23 0.78
Service Value
Customer
Satisfaction 0.35 0.08 5.67 0.08 0.67

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Table 2 given above shows the results of the regression analysis. The correlation
coefficient value R is 0.64. This shows a high positive correlation among the
variables. Given the dependent variable as behavioural intentions of the health
insurance customers and the independent variables as Service Price Perceptions,
Perceived Service Value and Customer Satisfaction, the table clearly shows the high
positive coefficient values of the independent variables (given the significant p-
values).

Thus, these results also confirm our hypotheses H1 a and H1 b whereby the
service price fairness has a positive impact on the customer satisfaction and the
behavioural intentions of the customers. Moreover, the Service Value also
significantly influences the behavioural intentions of the customers.

6.2 The evaluation of the influence of perceived service value and brand image
on brand preference and behavioural intentions of the health insurance
customers

The study of CFA and latent variable connections are included in the Structural
Equation Model using AMOS. Validity reliability measurement and variable
relationships to test the hypothesis may be included in this study.
The validity test is verified by a standardised loading factor > 0.5, and the reliability
test is confirmed by a Cronbach alpha > 0.7. This study found that all of the
questionnaire questions were valid and reliable. As a result, all of the indicators have
good and appropriate measures based on statistical criteria. The study's validity in
assessing standardised loading factor also indicates that it meets the CFA in SEM
criterion.
Relationships among the variables
The whole SEM model can be seen in Figure 1, from which some of the regression
coefficients of each route analysis may be deduced.

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 Service Brand
price preference
perception
s

Perceived
.35
service CUSTOMER
values .0 STAISFACTION

Brand Behavioral
image intentions

Figure 1: Perceived service cost, service quality, satisfaction, brand image, and
behavioural intention all have structural connections.
* p<0.05 (significance value)

As can be seen in the graph above, there is a positive correlation between perceived
service quality and service pricing, as well as brand preference and behavioural
intentions.
The standardized factor loadings have also been shown in the above figure.

7. Findings and Discussion

As can be seen from the above study, customer happiness is often regarded as a
significant predictor of purchase intentions and behaviour in the service business.
Despite the initial concern that different results could be obtained owing to the
unique nature of the healthcare insurance sector, this analysis indicates the same.
The perceived degree of customer satisfaction as a deciding factor in choosing and
preferring different health insurance companies. This study shows that happy

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consumers acquire a brand preference for the insurers that provide them with good
services.
This research adds to the body of knowledge in this field by demonstrating the
favourable influence of perceived service costs on brand selection in the Indian
healthcare insurance sector.
To the best of the researcher's knowledge, no prior research has been conducted in
the healthcare insurance sector on the mediating function of brand preference in the
causal link between customer happiness and customer loyalty. This study addresses
a knowledge vacuum by examining if a mediating impact exists in India’s healthcare
insurance sector, and if so, how powerful it is.
This study adds to the body of information about the impacts of customer
satisfaction, brand preference, and costs on customer loyalty amonghealthcare
consumers.
Both the healthcare insurance business and the general public benefit from the
research. The findings imply that practitioners should develop suitable methods to
increase their performance and retain clients. Another conclusion of the study's
results is that policymakers should design stronger and more extensive regulatory
mechanisms to increase the acceptability of the reformed system and to improve
policyholder protection.

8. Some shortcomings of the study

Even though this study will help academics better understand the links between
service quality in the health insurance sector, client happiness, and behavioural
intention, it is also important to point out the study's flaws.
Because the current study was done exclusively in India's Delhi-NCR region, the
findings cannot be generalised to other contexts. As a result, similar research should
be conducted in other areas to expand the findings' generalizability.

Despite these limitations, the findings provide valuable markers for further study.A
future study might look into how medical insurance companies (both public and
private) perceive service quality and how it influences other factors such as
satisfaction and behaviour.

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 9. Conclusion

Insufficient research has been done in developing countries to investigate the sorts
of relationships that exist between three essential constructs: service quality,
customer satisfaction, and behavioural intentionin recent years. The bulk of research
has been conducted in industrialised countries and cannot be applied to the Indian
setting. Furthermore, research in India is quite limited.
The goal of this study was to find dimensions and relationships between essential
factors in private and public health care insurance: service quality perceived prices of
services, satisfaction, and behavioural intentions.
The combination of various viewpoints improves our comprehension of these
concepts. The aforementioned findings offer a variety of consequences for research
and management, as well as important insights into different customers’ views in
health care settings.

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