Relationship Between Research Variables in the Model

test. As presented in chapter 2, the standard for testing research hypotheses is conventionally taken at the 5% significance level (or 95% confidence level). The results of testing the hypotheses are as follows:

 Testing hypothesis H1 : The reliability and responsiveness factors have a positive impact on customer satisfaction. This means testing the Beta coefficient of the positive RLS variable. The analysis results from the research data show that the corresponding t-statistic has a p-value = 0.000 less than 0.05, the corresponding Beta coefficient is β = 0.233 greater than 0 (Table 3.28). That shows that from the research data, it can be assumed that the reliability and responsiveness factors have a positive impact on customer satisfaction at the 5% significance level. In other words, we accept hypothesis H1.

 Testing hypothesis H2 : Service capacity factor has a positive impact on customer satisfaction. This means testing the hypothesis that the Beta coefficient of the variable ASS is positive. The analysis results from the research data show that the corresponding t statistic has p-value = 0.011 less than 0.05 and the corresponding Beta coefficient is β = 0.143 greater than 0 (Table 3.28). That shows that from the research data, it can be assumed that service capacity has a positive impact on customer satisfaction at the 5% significance level. In other words, we accept hypothesis H2.

 Testing hypothesis H3: The empathy factor has a positive impact on customer satisfaction. This means testing the hypothesis that the Beta coefficient of the EMP variable is positive. The analysis results from the research data show that the corresponding statistic has a p-value = 0.911 greater than 0.05 (Table 3.28). That shows that from the research data there is no basis to assume that the empathy variable has an impact on customer satisfaction at the 5% significance level. In other words, we reject hypothesis H3.

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 Testing hypothesis H4 : Tangible factor has a positive impact on customer satisfaction. This means testing the hypothesis that the Beta coefficient of the TAN variable is positive. The analysis results from the research data

The study shows that the corresponding t-statistic has p-value = 0.003 which is less than 0.05 and the corresponding Beta coefficient is β = 0.137 which is greater than 0 (Table 3.28). This shows that from the research data, the tangible factor has a positive impact on customer satisfaction. In other words, we accept the hypothesis H4.

 Testing hypothesis H5 : The corporate image factor has a positive impact on customer satisfaction. This means testing the hypothesis that the Beta coefficient of the IMA variable is positive. The analysis results from the research data show that the corresponding t-statistic has a p-value = 0.208 greater than 0.05 (Table 3.28). This shows that from the research data there is no basis to assume that corporate image has a positive impact on customer satisfaction at the 5% significance level. In other words, we reject hypothesis H5.

 Testing hypothesis H6 : The price perception factor has a positive impact on customer satisfaction. This means testing the hypothesis that the Beta coefficient of the PRI variable is positive. The analysis results from the research data show that the corresponding t statistic has a p-value = 0.000 less than 0.05, the corresponding Beta coefficient is β = 0.242 greater than 0 (Table 3.28). Thus, from the research data, it can be assumed that the price perception factor has a positive impact on customer satisfaction. In other words, we accept hypothesis H6.

Evaluate the importance of each independent variable in the model

Thus, the regression equation showing the relationship between variables in the model can be represented as follows:

Relationship between service quality, image and perceived price to customer satisfaction: SAT = 0.320 + 0.233RLS +0.143ASS + 0.137TAN + 0.242PRI.

The results of this analysis also show that customer satisfaction is affected by many different factors, but the level of influence of the factors on customer satisfaction is different. To evaluate the level of impact, we use the standardized Beta coefficient 6. The results from the research data show that the factor "perception of price" has the greatest influence on customer satisfaction (β = 0.237), followed by

6 In practice, it is possible to use unstandardized coefficients because the measurement scales have the same units of measurement.

are the reliability and responsiveness factor (β=0.251), the service capacity factor (β

=0.149) and finally the tangible factor (β=0.137). The analysis results can be described in the following diagram:

Reliability and Responsiveness

0.251*

Corporate Image

0.237*

Price perception

Customer satisfaction

0.137*

Service capacity

Empathy

0.149*

Adjusted R2 = 0.731 *

Tangible means

Figure 3.20 Relationship between research variables in the model

Statistically significant Not statistically significant

*Significance level 0.05

Thus, it can be seen that non-life insurance activities in Vietnam have achieved certain results, but there are still many limitations. These limitations originate from subjective and objective causes. The research content of this chapter has generalized the basic causes, established a correlation model between the funding structure and the efficiency of the enterprise, as well as built a mathematical model showing the relationship between service quality, price perception, corporate image and satisfaction, the impact of satisfaction on customer loyalty. This is a solid scientific basis for proposing recommendations and solutions to serve the development of non-life insurance activities in Vietnam.

CHAPTER 4

SOLUTIONS FOR DEVELOPING NON-LIFE INSURANCE ACTIVITIES IN VIETNAM

4.1 Orientation and viewpoints on non-life insurance development in Vietnam

4.1.1 Development orientation of Vietnam's insurance market

The development orientation of Vietnam's insurance market is stated in Decision No. 193/QD-TTg dated February 15, 2012 of the Prime Minister. This Decision clearly states the development orientation of Vietnam's insurance market until 2020 as follows:

General objectives:

Developing the insurance market in line with the economic development orientation

- National social and financial conditions in each period; ensure the implementation of international commitments of which Vietnam is a member. Enhance the safety, sustainability and efficiency of the market and the ability to meet the diverse insurance needs of organizations and individuals; contribute to stabilizing the economy and ensuring social security. Approach international standards and practices on insurance business and gradually narrow the development gap with countries in the region. [1]

Specific objectives:

Building a system of mechanisms and policies on insurance business that is complete, transparent, equal and synchronous, facilitating market development and ensuring the implementation of Vietnam's international commitments.

Improve the safety of the system, operational efficiency and competitiveness of insurance companies. Develop insurance companies with strong financial capacity, management capacity meeting international standards, effective operation, and the ability to compete actively in the domestic and regional markets.

Encourage and support businesses to diversify insurance products, ensuring to meet the diverse insurance needs of organizations and individuals. Create convenience

Benefits for organizations and individuals, especially low-income people, to participate in insurance.

Diversify and professionalize insurance distribution channels, creating an effective bridge between insurance companies and customers.

Organize professional, modern and effective market management and supervision; strongly promote the role of members of the state management agency on insurance business at the Southeast Asian Insurance Management Forum and the International Association of Insurance Management Agencies; gradually comply with the standards of insurance management and supervision issued by the International Association of Insurance Management Agencies. [1]

4.1.2 Viewpoint on developing non-life insurance activities according to market mechanism

Non-life insurance services as well as other services/goods need to be developed according to the market mechanism. Market supply and demand factors will determine how the service is developed. The State needs to limit market interventions that can distort and affect the development of services. The role of the State is to create legal corridors for the market to operate effectively and ensure that market participants strictly enforce the provisions of the law, while at the same time having sanctions and measures to prevent actions that can lead to unfair competition . From the perspective of service development according to the market mechanism, the manufacturer/supplier will provide products/services according to what the market needs (demand side). The driving force of the market is the benefit (buyer) and profit (for seller). Buyers and sellers are the subjects participating in the market to seek their own benefits without the intervention of the State. To develop non-life insurance services according to market mechanisms, it is necessary to pay attention to market participants including (1) customers; (2) insurance companies and (3) State management agencies.

On the customer side, there are growing needs for ensuring safety for property, personal liability, or human life and health, etc. due to unpredictable factors.

unforeseen events that may occur in one's life. From there, the needs that need to be met for insurance products are formed to ensure against possible risks. From here, market demand will be formed and signals will be sent to service providers, which are insurance companies, to meet these needs.

On the insurance side, proactively grasp the needs of customers, design products suitable for customers to satisfy them and thereby make a profit. At the same time, it is necessary to build strategies and policies to be able to compete with other businesses in the market. Developing services according to the market mechanism requires businesses to be proactive and creative in meeting customer needs.

On the part of state management agencies: To operate according to the market mechanism, state management agencies do not interfere too deeply in the activities of enterprises or customers. State management agencies are only a tool to ensure that the market operates effectively and that participants respect the common rules of the game. Sanctions are built to deter, prevent and correct any market participant who does not comply with the rules of the game.

4.1.3 Developing non-life insurance activities in a sustainable direction

As with many other products or services, non-life insurance activities also need to develop in a sustainable direction. Experience in developing insurance in the world in general and non-life insurance in particular shows that the insurance market often has a development cycle lasting from 2 to 10 years (VPBS, 2014) [19]. According to experts, the Vietnamese insurance market is in the stage before a new market boom cycle with the following characteristics: (1) low insurance premiums; (2) expanded insurance coverage; (3) relaxed risk assessment standards and (4) increasingly fierce competition among insurance companies. Facing a new business cycle with a high level of competition, the requirement for sustainable development is also extremely urgent and necessary. The perspective on sustainable development must be thoroughly understood and implemented by businesses in practice. Sustainable development is reflected in the following aspects:

Firstly, continue to expand the market for growth, especially the currently untapped market segments such as: Markets in rural areas, remote areas; develop new insurance products for many subjects in need of insurance such as: agricultural insurance products, insurance for farmers, liability insurance... to aim for socio-economic development goals.

Second, development must be linked to the business performance of insurance companies. The goal of increasing revenue and market share is necessary for businesses, but as a business, the first goal of a business is still profit. Businesses can use business strategies that trade off between short-term and long-term profits. That is, they can accept short-term losses for business plans, but in the long term, they must make profits to maintain and develop the business. If businesses only pursue revenue and insurance market share, and suffer losses for many years, their ability to pay will decrease, which will affect not only the business but also the insurance participants and the entire economy. In fact, in Vietnam, there is still a phenomenon of businesses competing with each other in an unhealthy way, such as: lowering premiums below the safe level, paying high commissions, expanding non-technical terms... which can become risks for businesses and the entire economy. Insurance companies must develop long-term strategies and strictly implement them because breaking the rules to carry out unfair competition will only lead to a chaotic market and all participants will suffer losses. This also requires the supervision function of state management agencies for the market to be carried out effectively.

Third, to develop a business, it is necessary to create services that meet customer demands, creating customer satisfaction and loyalty. Businesses with a large number of loyal customers will bring competitive advantages over other businesses. Studies show that loyal customers tend to complain less, buy more and are an effective word-of-mouth communication channel for businesses. For non-life insurance products, there is a time

The shorter the contract, the more meaningful it becomes to create loyal customers.

4.1.4 Developing non-life insurance activities towards specialization, professionalization and centralization

Developing in the direction of specialization, professionalization and centralization is also a point of view that insurance companies need to pay attention to. Because along with the development trend of society, customers demand higher and higher services, so professionalism is very important. Professionalism must be demonstrated in all market participants from state management agencies, insurance companies, customers and insurance associations.

On the part of the State management agency: The licensing of operations, supervision of implementation, market management, etc. of the management agency must approach international standards and be suitable to the socio-economic conditions in Vietnam. Professionalism for the state management agency must be demonstrated through transparent, public processes and accountability to competent authorities and the public. The state management agency acts as a midwife for businesses, creating conditions for businesses to do business, compete with each other under a common law and ensuring the interests of market participants (insurance companies and customers).

On the insurance side, business operations must be professionalized in all stages: personnel, organization, exploitation, appraisal, compensation, etc. One of the professionalization measures is to use standard, unified processes for departments in the organization. Professionalism is also uniformity and stability in service quality.

On the customer side, professionalism is demonstrated in understanding and fully understanding the benefits and significance of participating in insurance. Participating in insurance must be considered to ensure both personal interests and the interests of the community, participating in insurance is not for the purpose of insurance profiteering.

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