A system study for the underwriting division of Rizal Surety & Insurance Company

• Main Author: Sanchez, Jhoanna A.
• Format: text
• Language: English
• Published: Animo Repository 1998
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/1648
• Institution: De La Salle University

This study is concerned with the Underwriting Division of Rizal Surety & Insurance Company. The problem being addressed is the 44% Delayed Policies Record that is currently being experienced by the company. It is a serious and urgent problem because 3,900 out of the 8,821 of the policies processed for 1995 were delayed that challenges the objective of the system of prompt processing of the policies that should be within two days. This needs to be solved right away the immediate effects of this problem are the loss of the customer's goodwill that costs Php 355,240 slowed collection of premiums, which incurs an opportunity loss of Php 158,780. The system management and these writers believe that they have significant time and resources to solve this problem. The problem has the following specifications: What: The problem is the delayed processing of the Fire and Motor Car policies going beyond the company's goal of processing the policies for two days. Where: The delayed processing of the Fire and Motor car policies has been located in the policy issuance of the Underwriting Division. When: The delay has been observed to occur during the risk inspection, verification of the application, risk evaluation & distribution, encoding and in the proof reading processes of the Fire and Motor Car policies. How much: It has been seen that most of the policies for Fire are delayed by more than 8 days and for Motor car, within the range of 1 to 8 days delayed. Its main causes are: Slow risk inspection, unavailability of underwriter, lack of information and errors in encoding. The following are recommended to fully solve the problem: Avoid batching of policies, monitor the attendance of the underwriters and warrant a substitute in case of unavailability, supply information sheets and issue endorsements and provide underwriting training to the policy issuance staff and monitor their performance. This solution is expected to result to a total yearly operating expense of P7,564 and a net benefit of P 506,456. In addition, the proposed solutions are expected to result to a reduction of within-company decision errors due to late, incomplete and inaccurate reports and outputs. The solutions will also result to faster reporting of information needed in the system, more accurate encoded policies and more established control procedures over the movement of the policy issuance process. The implementation of the recommended solution is proposed to have a duration of six weeks and after the one-month implementation of the method, follow-up will be made every three months for improvement.