ASQ SECTION 300
INSURANCE COMPANY CASE
Jorge Rosas – Quality Manager
Chubb Group of Insurance
New York, October 12, 2010
All material presented is Chubb & Son Proprietary information and may not be used or replicated
without prior written consent.
Broker Survey Conclusions
• Broker perception of a high quality service hinges on
the relationship with front line team (UW/UA/CSR).
• This perception of high quality service has a definite
impact on both the overall broker satisfaction and the
probability of placing additional business with Chubb.
Key Characteristics* of High
• Ease of access and communication with company
• Conformance with Client/Broker specifications and
• Timeframe of contact after submission
• Delivery of quotes within specified timeframes
*Based on VOC survey
The Kano* Model – Impact of Quality
Characteristics on Satisfaction
• Delight (key drivers):
– Accessibility High
• Performance (basic Max pt.
– Technical expertise characteristic Must-be characteristic
– Competitive rates
• Must-be (non drivers),
– Financial solidity
Low Investment in Characteristic
*Dr. Noriaki Kano, Science University of Tokyo
Stock Performance of Companies with Quality
Programs (Kopp Index) vs. the S&P 500 Index
By investing in the enhancement of those quality
characteristics that drive delight (Accessibility, Accuracy,
Responsiveness and Timeliness), we will exponentially
improve the probability of brokers placing business with
Chubb, thus improving the potential appreciation of Chubb’s
What is the Quality Program
• It concentrates on the accuracy of the
• Measures customer sensitive characteristics
• Tracks regulatory compliance
How does this impact the
• The goal of the Quality Program is to deliver error free
policies to the Brokers
• Minimizes Broker E&O exposure
• Enhances Broker efficiency by reducing rework and
• Uncovers areas of improvement that both the Broker and
Chubb may influence
How can we use the Quality
Program as a Marketing tool?
• By providing Broker specific reports that show how
Chubb is performing in customer sensitive Quality
• By using the same Quality checklists used by Brokers to
control Carrier quality, so that they are comfortable that
we are measuring what is important to them
• By establishing differentiated Quality based SLA’s
The Past. . .
• Quality assessments were performed by
individual zone or branch
• Compliance and state-specific-oriented vs.
• Diverse checklist, administered with great
• No standardized tools or systems to capture
• Standardization of checklists
– New Hire and Production Line QC
• Standardization of procedures
– New Hire Certification and Random Sampling
• Designated person to check consistently
• Standardized reports and metrics
Quality Improvement Benefits
• Customer Satisfaction: the overarching Quality
Management System and the Process Improvement
methods are predicated upon the Voice of the Customer
(VOC), which is a customer driven methodology.
• Decreased Costs: through focusing on continuous and
relentless improvement in end-to-end quality, more
efficient and effective processes will be implemented
resulting in decreased rework and improved capacity.
QUALITY AND PROCESS IMPROVEMENT
MEASURE IN UO NT
CONTROL NT EME
Process CO OV
Quality of and efficiency
Quality of Design:
Brainstorming, Cause & Effect Descriptive stats, SPC, Process
analysis, Customer surveys, Calibration, CAPA, capability,
ServQual, QFD, Quality Reliability, Quality manuals Quality audits,
characteristics, Data mgt COPQ, ROI
QUALITY MANAGEMENT SYSTEM
• Pro e-
W or k n or P QC
chec Review w
k ith NH
• Rev lists
proce w of Cer
• Pro -
• Pro n wor QC
• Produ e-issuance Q
• Proce ion work
e 2 Re
New Hire Certification
• 30 T
issuan20 per UA per year, p
- Post er
• Prod ce QC -
• On-g work
Quality Program Phases
The Checklists - CTQs
• Created by a cross-functional team of experts
• Designed specifically for New Hire and
• Customized for each Line of Business subject to
• Compliance and Customer focus
• Yes/No answers (binary distribution) = less
QC Staff Roles
• Quality Coordinator
– Lead and/or facilitate the quality control process within one or more
– Focus on Quality process coordination and generating reports.
– Serve as the liaison with the other functional areas of the Centers to
provide support to comply with quality initiatives.
• Quality Specialist
– Responsible for the ongoing Branch and Center QC processes.
– Analyze quality trends and provides feedback to Center/Branch
– Maintain communication with Home Office Quality on system and
• Quality Technician
– Provide quality support in the Centers.
– Perform basic quality tasks.
– Responsible for the NHQC transaction reviews.
– May switch between QC and CSR responsibilities.
New Hire QC Method
• A Continuous Sampling Plan was chosen as the best
way to obtain a statistically valid sampling procedure
(CSP-C i =10, f =0.5, c =0)
• A certification algorithm was created as a way to ensure
consistent quality of WPC’s products.
• All transactions subject to QC
• All reviews performed pre-issuance
• Conforming Reviews:
– Those in which 85% or more of the checklist questions are
• Stage 1 QC:
– 100% control on all transactions.
– 10 consecutive reviews must be considered conforming before
moving to Stage 2.
• Stage 2 QC:
– 50% of the transactions will be reviewed.
– 5 consecutive reviews must be considered conforming before
certification can be issued.
Production QC Method
• Conforming Reviews: 100% of checklist questions
• Quota random sample, evenly distributed, minimum 30
reviews per year, c = 0 (Zero Acceptance Number)
• Book/Issue transactions only, on major LOB
• All reviews performed post-issuance
• Defect Free Rate (DFR) metric
• Goals established at individual, unit and Branch level,
based on DFR
• Trend analyses used for CAPA
Global Quality Information System (GQIS)
Repository SM and Procedures
BPM Intelligence Reports
QM = Quality Management, QC = Quality Control, SM = Statistical Methods, BPM = Business
• BPM: automated workflow and process controls
• Automated data loads: ability to source data from multiple systems;
i.e. CUW IM, CSI Express, EZER (EUZ)
• Flexible sampling plans: large array of sample variables available
• Customized checklists: the checklists containing the quality
characteristics under scrutiny are designed based on user needs
• Role-based user profiles: GQIS uses different roles, which are
defined in the system’s BPM engine to provide a role-based view of
• Variable workflows: system maps are configured based on user
defined and documented workflows and procedures
• Scalability: supports a large number of concurrent users in multiple
Cost of Quality
• Prevention: activities • Failures: the costs
specifically designed to relative to non
prevent poor quality in conforming products or
products and services. services
• Appraisal: activities – Internal Failure Costs: those
that are identified prior to
associated with delivery of the product or
measuring, evaluating or service, or that are not visible
to the customer after delivery.
auditing products and
– External Failure Costs: those
services to assure that are identified after
conformance with delivery of the product or
service to the customer.
Prevention – Appraisal – Failure Model
0 Quality % 100
Cost of Quality Results
CCI's cost analysis as a result of Finance for Improvement Program.
Finance for Improvement Breakdown
$20,000,000 Appraisal Costs
in a Medium
$5,000,000 $11,589,672 stage
• Quality Culture: both centralized and field operations have adopted Quality metrics as
a key strategy element. Employees now accept and request their individual Quality
• Certification: ensures all new hires reach a minimum processing knowledge threshold
prior to production duty.
• Production QC (PQC): ensures production line employees are performing up to
expected Quality standards through an ongoing feedback loop.
• Defect Free Rate (DFR) Goals: this metric, which indicates how often we are providing
the customer a flawless product and how well we are complying with applicable
regulations, has become an integral part of individual and Branch/Center level
• Global Quality Information System (GQIS): a dedicated Quality application has been
deployed throughout the U.S. It is the platform through which future Quality
products/services will be delivered for all domestic and international territories.