Proposal Project

Issue/problem: is it lack of clear automotive policies or is it the lower rates that are prompting members to leave USAA insurance

Why this insurance is not competitively priced?

( Adverse driving histories ) ( Better claims satisfaction rate ) ( Improved services )

( Better coverage )

( Guaranteed renewal ) ( Introductory rates )

( Shared risk )

( Members’ education )

SORTING OUT

( Adverse driving history ) ( Shared risk ) ( Improved services ) ( Guaranteed renewal ) ( Leadership ) ( Communication ) ( Better coverage ) ( Introductory rates ) ( Better claims satisfaction rates ) ( Services )

( Members’ education )

ANALYSIS

The above diagram is an illustration of the various things that can be done by this company to improve its services and retain its members. One of the critical things, as observed here, is educating the members about insurance.

Five “whys” of cause analysis

This will help us in understanding the reasons why the members are leaving the company.

Defined problem: this insurance company has to lower its rates so that it can be able to maintain a competitive edge with the industry. This can happen through using the five ‘whys’ to understand why the situation is as it stands

Why are the rates of USAA generally higher than those of the competitors?

The insurance in this company is a shared risk, which means that the more paid out, the higher rates for everybody. Why is this so?

1. The company s eligibility based and it divides the members into various diverse companies based on their eligibility. Every company shares the risk withal the other members of that company. Why is this so?

2. This organization has a guaranteed renewal endorsement meaning that the policies are renewed every term. Why is this?

3. This company outsources the auto insurance that is not licensed to the third-party vendors who transfer the call t the authorized representatives.

4. Members require t be educated regarding how the insurance works and how it can impact them and their families.

5. The members who have never had a claim are not aware o the company's satisfaction experience rate.

Root cause validation

This company has not been competitive because of the policies that usually increase membership rates, and the company burdens the members (Smith, 2019). Similarly, its membership is only limited to the military and their family members. Thus it does not compete well with the other insurance companies offering the same services to civilians (Carson, et al., 2017). Applicants with pre-existing conditions also do not qualify for the USAA policy.

References