CU TO REORGANIZE OPERATIONS

LONDON-Commercial Union P.L.C. is planning to reorganize its non-life insurance operations in a move designed to save (British pounds) 100 million a year by 1999.

The proposed changes will restructure CU's head office operations around nine new "trading units," each of which will focus on a specific market sector: industrial; personal lines; global risks; corporate partnerships; construction; small businesses; services; real estate; and retail.

Each unit will have the ability to handle all aspects of product development, underwriting, marketing and delivery and will work with CU's distribution channels and business partners to better meet the needs of customers within their area, according to the insurer.

Earlier pilot studies of this approach in some of CU's branch offices showed that customer-focused teams generated two-thirds more quotes, while business written by those teams was up by one-third, compared with other offices.

Some of the intended savings will also come from greater use of new technology, some from streamlining branch management, and some from an anticipated reduction in claims handling costs.

Measures would include consolidating the handling of litigation down to three centers rather than handling it separately at all branches, as at present, and dealing with fewer loss adjusters.

"The restructure of our general insurance operation will enable us to focus on end customer groups and distribution channels. In turn, we will become more market focused and responsive," said Cees Schrauwers, managing director of non-life insurance for Commercial Union.