...| Manzana Insurance: Fruitvale Branch (Abridged) | Case Analysis | | | Group no 4(Section E) | Priyanshu Kumar 1311314Shranya S Mukund KumarPreethi VenkatramanPradeep R | | | Introduction Manzana Insurance was founded in 1902 in Sebastopol, California where it mainly operated in the business of orchard and farm insurance. It now deals in property, flood and commercial property insurances. Manzana operated through a network of three branch offices in 3 states of the United States of America – California, Oregon, and Washington. Each branch was treated as a separate profit and loss center. Its dealings with public happened through a sales force consisting of 2000 independent agents who represented Manzana as well as their competitors. With the entry of a new competitor named Golden Gate Casualty Manzana’s growth began to decline owing to high interest rates and intense. This case is concerned with the performance of the company’s Fruitvale branch, which has been consistently losing business to its archrival Golden Gate in its territory. The Fruitvale branch performed badly on various measures like total number of requests for new policies, endorsements, and renewals processed, very high turnaround time resulting in late renewals and increased renewal loss rate. Problem Overview The Fruitvale branch of Manzana Insurance handled property underwriting i.e., issuing new insurance policies, quotes, endorsements or renewals. The branch profitability was...
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...Introduction This study is designed to determine why the Fruitvale branch of Manzana Insurance is performing so poorly for Property Insurance. Golden Gates, a competitor of Manzana, numbers are estimated to outperform Manzana Fruitvale branch as well. There are several problems that are leading to the poor performance at this branch. This past quarter turnaround time increased again reaching 6 days, where Golden Gate is sitting at 2 days. Also the system is running very close to efficiency, which can cause a problem down the road with changes we recommend. A big problem with what is going on has to deal with the RUNs and RAINs being of higher priority than the RERUNs for the senior underwriters. The senior underwriters are simply accepting the RUNs and RAINs first because those are more profitable for them, but this is hurting the company as our renewal loss rate hit an all-time high at 47%. Something must be done about these problems if we are going to compete with Golden Gate in this territory and below are these problems in more detail along with recommendations on how we feel these problems can be resolved. Findings TAT The calculation of TAT was made by multiplying the number of each type of request at each desk by a standard completion time (SCT). The 95% SCT is the time during which 95% of the requests should be taken care of. The company assumes that the variability of the processing time has the normal distribution, which has the characteristic that with a mean of...
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...Manzana Insurance: Fruitvale Branch (Abridged) Group No. 7 Agenda Introduction Company Background Organizational structure Operational Flow Financial Health Current Utilization Capacity RUNs v/s RERUNs Profitability Factors of the Industry Recommendations Introduction Manzana’s Fruitvale branch is suffering from declining profitability. Falling renewal rate and rising turnaround time are the main issues. Other issues are incorrect prioritization of requests and the uneven distribution of workload in 3 underwriting teams. Turnaround time (TAT) much greater than competitor’s. Company Background Founded in Sebastopol, California, in 1902. Originally specialized in orchard and farm insurance. Post 1906,expanded by buying several insurers in northern California. Anticipating boom in home ownership in southern California, bought Casualty and Escrow Company. By 1953, became California’s 2nd largest home and property insurer. In 1970s,growth starts to falter due to high interest rates and intense competition from Golden Gate. In 1989, acquired by Banque du Soleil and new management installed. Organizational Structure Operations Flow Underwriting Team 1 1 Underwriter 1 Technical Assistant Originating Agent Distribution 4 Clerks Underwriting Team 2 1 Underwriter 1 Technical Assistant Rating 8 Raters Policy Wrinting 5 Writers Underwriting Team 3 1 Underwriter 1 Technical Assistant Parameters /...
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...| Syndicate Assignment | Manzana Insurance Fruitvale Branch | Operations | | | 01 June, 2016 | | | Manzana’s Position in the Insurance Industry Manzana has a history of seeing opportunity and seizing it. Manzana has grown through acquisition. Manzana's main competition is Golden Gate Casualty. They beat Manzana on both price and performance. Golden Gate tied with Manzana for first place in the property insurance market in 1988. By 1991, Golden Gate announced they could guarantee turnaround time (TAT) of one day. If they fail to reach that benchmark, they offer a 10% premium discount. Manzana must at least match that promise to stay competitive in this market. The current TAT for request processing has bloated to five or more days at a time. This report will recommend a number of strategies to improve the system in operational efficiencies, measurement and service. Manzana has an opportunity to increase their business through decreasing their TAT, adjusting staff incentives and delighting their customers. The acquisition of Manzana by Banque du Soleil has helped. There was a restructure that resulted in a leaner company. Underwriting standards have tightened, operating expense has reduced and this has resulted in a regain of market share. After the restructure, they are now better geared toward the property liability insurance market. Manzana now specialise in commercial insurance rather than personal insurance. That has pitted them against Golden Gate...
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...of the Manzana Insurance Fruitvale Branch 1. Describe and evaluate Manzana's operations strategy Manzana has an operations strategy focusing on autonomy among branch offices that shows in the case operational inefficiencies, and it considers each branch as a separate profit and loss center with the space to underwrite insurance, collect premiums and settle claims within territory. Manzana has generally 3 territories of operations, where the company does not deal directly with public, instead of that it operates through 200 independent agents whom are working with other companies, but in case of Manzana the agents are dealing with 4 departments that cooperate with them from within to process the policies whom in order based on the policy process: Distribution, Underwriting, Rating and Policy Writing. The major areas of concern includes: high Turnaround time (TAT), the turnaround time is the total time taken to process a request. At present Manzana’s TAT is around six days compared to one day TAT of its major competitor Golden Gate Insurance firm. The inappropriate work force distribution at Manzana makes some workers to be idle and others being stretched to work, making the system inefficient. There is significant proportion of policies which are being renewed late, this is primarily because the policies which are required to be renewed (RERUN) are being intimated to the customer only in the last day which results in loss of business. The various departments in Manzana have different...
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...The Manzana Case Manzana Insurance- Fruitvale Branch case study Executive Summary The Fruitvale Branch of Manzana is facing its bitter reality of declining profitability and potential loss of market shares to its main competitor-Golden Gates due to its rising renewal loss rate and expanding turnaround time. In our analysis, we dig into several issues that were possible causes for the problem and tend to provide readers with feasible solutions that may resolve the issues on hand. Examples of such issues as we have identified in the case include, but not limited to, various departments’ deviation from FIFO system, potential capacity and staffing problems, uneven workload among three underwriting teams, outdated SCT for computing TAT, and inaccurate computation process for TAT. In order to lower the number of late renewals and reduce turnaround time, our recommendations include, but not limited to, the following: 1) Making it mandatory for all departments to comply with the FIFO system and implementing monitoring plans for overseeing the entire underwriting process to ensure FIFO is strictly implemented; 2) Revising the incentive scheme for Fruitvale Branch employees to further assist with the successful implementation of FIFO system; 3) Expanding the number of days RERUNs are released to DCs prior to the due dates to ensure that there is sufficient time for relevant departments to complete the requests on or before due dates; 4)Revising and updating the SCT used for...
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...1. How is the Fruitvale branch doing? On viewing the financial performance of Manzana Ltd., we see that the branch profitability is decreasing. There is a huge backlog of policies, which is resulting in delays for current orders too. The number of new policies and endorsements appeared to be stagnating, whereas the rest of the industry reported moderate growth rates. According to the figures of the present quarter, Fruitvale had shown a decline in insuring new policies whereas Golden Gate had issued 100 more policies than them in the same quarter. Moreover, the turnaround time, the time from policy request to policy issue, for Fruitvale was 5 days, which was, much more than the turnaround time of Golden Gate (2 days). The branch was also losing on renewals, which amounted to nearly 33%, again more than double of Golden Gate. The renewal losses represent a significant loss of business and an overall reduction in the number of policies in force. While new policies have not increased substantially, renewal policies are being lost, thus, effective growth isn't happening. 2. What are the causes of these problems? One of the causes is the wrong method used in calculating the turnaround time. Their calculations show a much higher time than is actually the case, hence, agents don't want to work for them and readily switch to the competition. Another cause is the employees' lack of willingness...
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...La manzana es una excelente astringente y exfoliante. Puedes usarla de la siguiente forma: - Pela una manzana y córtala en rodajas finas, luego aplica en el cutis para limpiar la piel grasa. - Para desinflamar los ojos hinchados, cúbrelos con dos rodajitas de manzana durante cinco minutos. - Para el cabello, mezcla tres cucharadas de vinagre con una taza de zumo de manzana y luego enjuaga el cabello. La banana posee una profunda acción suavizante y quema las quemaduras producidas por el sol. Como puedes usarla? - Para limpiar, aplasta la banana y unta el cuello y la cara con la pulpa. Relájate durante diez minutos y enjuaga con agua fría. - Para eliminar manchas y purificar la piel, aplasta una banana y mézclala con cinco cucharadas de avena en polvo, agrega agua hasta lograr una crema y úsala para masajear el rostro. El kiwi sirve como base para mascarillas usadas en el cutis graso. - Pela el kiwi, pícalo y hazlo puré, agrégale agua hirviendo y déjalo reposar por treinta minutos. Luego agrégale una cucharada de vodka o licor blanco (por el alcohol), mezcla bien y déjalo reposar nuevamente. Aplícalo al rostro limpio por quince minutos y luego enjuaga. EXFOLIANTE: Para lograr un exfoliante suave y natural, este consejo muy util y para hacer en casa. Mezcla los siguientes ingredientes: 1/2 taza de harina de maíz, 1/4 taza de leche, 2 cucharaditas de bicarbonato de sodio, 1 cucharada de aceite de oliva y 5 gotas de aceite de árbol de té en un recipiente, A continuación...
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...Bo Pang 301184541 Ivan Zhang 301156657 Tao Zhang 301184502 * Case Analysis * Case Analysis Manzana Insurance – Fruitvale Branch Manzana Insurance – Fruitvale Branch Introduction Manzana insurance, founded in California in the beginning of 20th century, originally specialized in orchard and farm insurance. During the first half of the 20th century, they expanded their business throughout California by buying other insurance company. After the World War II, Manzana had become the second-largest home and commercial property insurer in California. However, the profit of Manzana has been decreasing over the past year. There are four major causes for the profit decreasing, the first one is due to the high turnaround time. Manzana has the turnaround time for six days, which the competitor, Golden Gate only take two days to process their tasks and this is the essence competition between these two companies. Secondly, a number of late renewals cause a rise in the renewal loss rate which result in losing lots of customers for the company. Thirdly, the agents recommend other carriers to customers when contract renewals were late. The last one is that the competition in the insurance business had increased sharply these days. Thus Manzana insurance lose the market share. According to Manzana’s operations flow system, the processing time and the number of requests are sources of variability in the system and...
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...Harvard Business School 9-692-015 Rev. January 30, 1997 Manzana Insurance - Fruitvale Branch (Abridged) It was a Monday morning in early September 1991. Bill Pippin had been at Manzana for only a week, but already he was thinking that perhaps he should have taken a different job. He gazed at a note on his desk from John Lombard, his boss at the Fruitvale branch: "I'm giving a speech at a conference on property insurance, so I'll be out of the office until next week. Please give this some thought while I'm gone." The note was attached to a memo from Tom Jacobs, Manzana's senior vice president for underwriting operations: To: John Lombard From: Tom Jacobs Subject: Second Quarter Performance The performance figures on Property Insurance for the second quarter have just been completed, and Fruitvale is at the bottom of the list again. More important, Golden Gate is killing us in your territory, and they have just announced a promise of one-day turnaround time to all agents. If something isn't done immediately to improve your operating performance, a lot of our agents are going to defect to Golden Gate, and some of us are going to need new jobs. Here are some of the numbers: Manzana-Fruitvale This Quarter This Year New policies Endorsements Renewals Turnaround time (average) Renewals late Renewal loss rate 326 206 1,063 6 days 44% 47% This Quarter Last Year 278 235 1,253 5 days 20% 33% Golden Gate This Quarter (estimated) 375 300 1,400 2 days NA 15% Something has got to...
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...The Manzana Case Manzana Insurance- Fruitvale Branch Case Study The Manzana Case Manzana Insurance- Fruitvale Branch case study Executive Summary The Fruitvale Branch of Manzana is facing its bitter reality of declining profitability and potential loss of market shares to its main competitor-Golden Gates due to its rising renewal loss rate and expanding turnaround time. In our analysis, we dig into several issues that were possible causes for the problem and tend to provide readers with feasible solutions that may resolve the issues on hand. Examples of such issues as we have identified in the case include, but not limited to, various departments’ deviation from FIFO system, potential capacity and staffing problems, uneven workload among three underwriting teams, outdated SCT for computing TAT, and inaccurate computation process for TAT. In order to lower the number of late renewals and reduce turnaround time, our recommendations include, but not limited to, the following: 1) Making it mandatory for all departments to comply with the FIFO system and implementing monitoring plans for overseeing the entire underwriting process to ensure FIFO is strictly implemented; 2) Revising the incentive scheme for Fruitvale Branch employees to further assist with the successful implementation of FIFO system; 3) Expanding the number of days RERUNs are released to DCs prior to the due dates to ensure that there is sufficient time for relevant departments to complete the requests...
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...tle read: ... INDIAN INSTITUTE OF MANAGEMENT BANGALORE Manzana Insurance:Fruitvale Branch Submitted to Prof. Devanath Tirupati Indian Institute of Management Bangalore By: Group Number 6 Vikash Oraon 0911283 Abhijit Pagare 1011076 Bharathi Priya 1011087 Bhargavi Konathala 1011089 Bhavika Kansara 1011090 Vishal Kumar 1011143 Manzana Insurance Introduction Manzana Insurance was started in 1902, and by 1953 had become the second-largest home and commercial property insurer in California. However, since the 1970's Manzana has been facing troubles from intense competition from the Golden Gate Casualty, as well as problems from an inefficient operating procedure leading to late issuance of policies, customer dissatisfaction, and defection of agents to other firms. Situational Analysis Recent complaints from agents about the turnaround time, percentage late figure and the poorly performing renewal business iterate the below average performance of the Fruitvale branch of Manzana. The following points were presented in the case. ? Around 76 independent agents represent Manzana at Fruitvale and dealt directly with the public. There was a difference in the commissions each agent received according to the policy request. ? Exhibit 1 gives an overview of the Operations flow across the four tasks that are performed for every policy request. O A RUN goes through all the four stages [Distribution, Underwriting, Rating and Writing] while a RAP and RERUN bypass the select and classify sub-stages...
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...Manzana Insurance The Fruitvale branch is not faring well, they are behind competitor Golden Gate in new policies(375 to 326 in favor of Golden Gate), endorsements(300 to 206 in favor of Golden Gate), renewals (1,400 to 1,063 in favor of Golden Gate), turnaround time (2 days to 6 days in favor of Golden Gate), and renewal loss rate (15% to 47% in favor of Golden Gate) in the most recent quarter. The number of renewals, and endorsements at the Fruitvale branch are lower than they were for the same quarter the previous year, and the turnaround time, number of late renewals, and renewal loss rate have increased. The Fruitvale branch has performed especially poorly during the 1991. The main cause of the problems is that the Fruitvale branch processes RERUNS last because they are seen as less profitable than new policies. When RERUNS aren’t provided by the due date, it displeases customers and causes them not to choose to renew the policy with Manzana. In a market where prices are essentially identical, customers value the service they receive and how fast their requests can be processed. Therefore, since the Fruitvale branch is falling behind in this regard, the renewal loss rate is at a record high. Additionally, if a renewed policy is late, the insurance agent is likely to suggest another agency to customers, thus adding to the low retention rate. To make matters worse, only 15% of RAPs become RUNs, so they aren’t acquiring a large number of new...
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...------------------------------------------------- Manzana insurance ------------------------------------------------- Manzana insurance Operations Analysis Operations Analysis Executive Summary Manzana Insurance specialises in commercial insurance, with the Fruitvale branch typically processing 40 requests per day and the product mix being 60% new policies and 40% renewal requests. The operating performance of Fruitvale is deteriorating across five of the company’s six key performance measures. Additionally, competitor Golden Gate has promised efficiency in service and offered a guarantee for time request turnarounds. Our analysis of Fruitvale’s operations, priorities and cost structure shows that: * The “first-in, first-out” processing system is implemented differently across the teams, causing RERUNs to be submitted late and leading to lost renewals. * The increase in ordinary insured losses and declining revenues from renewals is causing a decline in Fruitvale’s profitability. * The current procedure to calculate turnaround time results in a high value and is really a worst case scenario. * There is a large degree of variance in the time it takes to handle requests, which can cause both the distribution and underwriting teams have more work than capacity. This affects responsiveness, as the system has little spare capacity to deal with increased demand due to variation, seasonality or new business. Based on our analysis, we make a number of recommendations for Manzana to implement: ...
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...OM Manzana Case Study - Team 2 (Rishi, Geoff, Vimalan, Rose, and Jonathan) Manzana Insurance Fruitvale Branch case study Executive Summary Manzana’s Fruitvale branch is suffering from declining profitability. The main issuesresulting in this phenomenon are its falling renewal rate and rising turnaround time.There are systemic issues with the process for handling requests that have led to thisdeterioration, including the incorrect prioritization of requests and the unevendistribution of workload amongst its three underwriting teams. There are also problems of understaffing in the Distribution and Underwriting teams and possibleidle capacity in the Rating and Policy Writing teams. To compound matters, the branch is using an incorrect methodology for computing turnaround time. Addressingthese underlying issues is key to Manzana’s ability to compete with Golden Gate,whose quicker guaranteed turnaround time will generate loyalty among independentagents and result in further loss of business for Manzana. To prevent this, thefollowing steps are recommended:-(i)the FIFO system on all requests received should be strictly implemented;(ii)the reward system for employees should be reviewed and aligned to supportthe implementation of (i);(iii) RERUNs should be sent to Distribution Clerks at least three days prior to theexpiry of the old policy;(iv) The workload among the three underwriting teams should be better balanced;(v)The SCT for the rating and policy writing teams need to be reviewed...
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