The Role of the Positive Switching Costs in the Insurance Industry

Anabela Marcos


The purpose of this paper is to test a framework in car insurances for examining the alternative routes through which different types of positive switching costs (social and lost benefits) operate in affecting outcomes, such as satisfaction, relational commitment, loyalty and word-of-mouth (WOM). Thus, the objective of this paper is to understand the role that positive switching costs plays in the insurance industry. This investigation proposes a theoretical model tested using structural equation modelling (SEM). A questionnaire survey was developed to explore the relationships among two positive switching costs (social switching costs and lost benefits costs), satisfaction, relational commitment, loyalty and WOM. For this study, 744 valid questionnaires were collected from a sample of Portuguese car insurance holders. The results show that lost benefits costs directly influence satisfaction, relational commitment, loyalty and WOM. However, social switching costs only influence relational commitment. In turn, satisfaction affects relational commitment, loyalty and WOM. Relational commitment increases loyalty and WOM. Finally, loyalty is a determinant of WOM. In order to address gaps in the literature, the present study developed an integrative model through which two types of positive switching costs operate in directly affecting loyalty and WOM and indirectly, via satisfaction and relational commitment. Research on the downstream effects of different types of switching costs is lacking. Therefore, this investigation examines the mediating role of satisfaction and relational commitment in the relationship between two positive switching costs and loyalty and WOM.


Positive switching costs; outcomes; car insurance

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International Journal of Marketing, Communication and New Media

ISSN: 2182-9306


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