Manzana InsuranceFruitvale Branch

1. Describe the problems facing the Fruitvale branch. Would you like to be Bill Pippin?

2. Who are Manzana's customers? Who are the consumers? How do the customers choose an insurance carrier?

3. Exhibit 7 shows that the total number of policies in force at the Fruitvale branch has declined from 5,201 (1989) to 3,946 (1991). Given this, why have gross premiums remained essentially constant (Exhibits 5 or 7)? What can you infer about the policies or policy holders in 1991?

4. The TAT calculations in Exhibit 3 are incorrect. Requests in queue are counted several times. What is the effect of this error on actual job-lateness performance? Recalculate Exhibit 3 to find the expected TAT for the week ending September 6, 1991.

9. Is the six-day turnaround time (TAT) the result of inadequate capacity?

10. Evaluate Manzana's system of dedicating underwriting teams to a particular set of originating agents. Do you expect this system to increase or decrease average capacity utilization and turnaround times as compared to a system where underwriting team are not dedicated to particular agents?

11. Why has financial performance deteriorated to a net loss in 1991 (Exhibit 5)? Be sure to relate your answer back to financial performance. (How does your answer change something on the income statement?)