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IAI Actuarial Core Principles · Business Management · Strategy, competitive advantage, strategic decision process and PEST analysis

Indus General Insurance's management reviews three items: (i) entering the crop insurance market through a new subsidiary, (ii) positioning its two-wheeler product as the cheapest online in the segment, (iii) reducing average claim settlement time in the Pune office from 12 to 9 days. Which option correctly pairs each item with its level of strategy, in the order (i), (ii), (iii)?

The correct pairing is corporate, business-unit, operational. Entering crop insurance through a subsidiary alters the group's scope. Positioning the two-wheeler product as cheapest is about competing in a given market. Reducing settlement time in one office is an operational matter of how the work is carried out.

  1. ABusiness-unit; corporate; operational
  2. BCorporate; operational; business-unit
  3. COperational; corporate; business-unit
  4. DCorporate; business-unit; operationalCorrect
  5. Corporate; business-unit; corporate

Explanation

Entering a new market through a subsidiary changes the scope of the group, so it is corporate. Positioning a product as cheapest is a choice of how to compete in a market, so it is business-unit. Cutting settlement time in one office is an operational improvement in how work is done.

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