A Case Study of Modern Business Practice: Tower Insurance, New Zealand

This case study examines the modern business practices of Tower Insurance, a New Zealand-based insurance company. It delves into both internal and external compliance requirements, including the Plus Cover Policy, Marine Insurance Act (1906), Consumer Insurance (Disclosure and Representations) Act 2012, and the Privacy Act (1993). The study analyzes the aims, agencies, and legislation associated with each requirement, evaluating their impact on the company and offering recommendations for improvement. The case study also explores compliance issues, such as data protection, and discusses the importance of adhering to regulations for maintaining customer trust, market position, and overall business success. The document provides a comprehensive overview of Tower Insurance's operations, compliance strategies, and the challenges and opportunities they present.

Running head: MODERN BUSINESS PRACTICE
Modern business practice- A case study of Tower Insurance, New Zealand
Name:

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MODERN BUSINESS PRACTICE
Table of contents
Introduction......................................................................................................................................4
A. Importance of compliance..........................................................................................................4
B. Business background...................................................................................................................5
A. Internal compliance requirements...............................................................................................6
Internal compliance requirement number 1.................................................................................6
Aim..............................................................................................................................................6
Agency.........................................................................................................................................6
Legislation...................................................................................................................................6
Internal compliance requirement number 2.................................................................................7
Aim..............................................................................................................................................7
Agency.........................................................................................................................................7
Legislation...................................................................................................................................7
APPLICATION...........................................................................................................................8
Internal compliance requirement number 3.................................................................................8
Aim..............................................................................................................................................8
Agency.........................................................................................................................................8
Legislation...................................................................................................................................8
APPLICATION...........................................................................................................................9

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B. Internal compliance issue............................................................................................................9
Compliance requirement..................................................................................................................9
Impact of the requirement on the company...............................................................................10
Recommendation.......................................................................................................................10
External compliance requirements................................................................................................11
External requirement 1..............................................................................................................11
Aim............................................................................................................................................11
Agency.......................................................................................................................................11
Legislation.................................................................................................................................11
APPLICATION.........................................................................................................................12
External requirement 2..............................................................................................................12
Aim............................................................................................................................................12
Agency.......................................................................................................................................12
Legislation.................................................................................................................................12
APPLICATION.........................................................................................................................12
External requirement 3..............................................................................................................13
Aim............................................................................................................................................13
Agency.......................................................................................................................................13
Legislation.................................................................................................................................13
APPLICATION.........................................................................................................................14

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External compliance issue.............................................................................................................14
Details of the compliance requirement......................................................................................14
Aim............................................................................................................................................14
Agency.......................................................................................................................................15
Legislation.................................................................................................................................15
Evaluation of the impact of the compliance requirement on the company...............................15
Recommendation for the compliance........................................................................................16
Summary and conclusion...............................................................................................................16
References and bibliography.........................................................................................................18

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Introduction
A. Importance of compliance
Companies and organizations need to adhere to certain rules and regulations for averting
the unwanted and unnecessary illegal instances. This is applicable for all of the companies and
organizations including Tower Insurance. At the first instance, development of policies and
strategies are developed for systematizing the business activities. In the trainings, the employees
are instructed to abide by the developed policies (Diallo & Lambey, 2017). The managers
provide the employees to sign a bond that until their tenure in this company, they would abide by
the policies, rules and regulations. Adherence to the developed policies and regulations helps the
personnel to avert encountering the illegal instances. Apart from this, adherence to the
legislations enables Tower Insurance to indulge in fair competitions with the contemporary
brands, which is flexible enough for the attainment of loyalty, trust and dependence from the
customers. This is not all, the managers use effective techniques to regulate the performance of
the employees. Rationality and consciousness in this management helps the company to enhance
their reputation. On the other hand, non-compliance to the developed policies, rules, regulations,
customs and traditions compels the company managers to encounter illegal instances, which
degrades their reputation (Hair, 2015). Along with this, non-compliance adds vulnerability to the
market position of the company. This vulnerability is an agent towards the loss of customers,
pushing the productivity to a very low grade. This projection attaches an interrogative parameter
to the aspect of foreign market penetration for the company.

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B. Business background
Tower Limited , is a New Zealand based company, which caters to insurance for general
aspects like fire. Founded in 1869, the company has its headquarters in Tower centre, 45 Queen
Street, Auckland. Operating under Fire and General Insurance, Tower Limited provides
insurance for house, car, contents, rural boats and travels. As per the data of 2013, the company
has achieved the gross profit of $44.2 million. The company operates under Fire and General
Insurance (Tower.co.nz, 2017). On 10 April, the company boycotted replacements for house
policies. This was in response to the constant pressures and blames of the international insurers.
In 2012, Tower Insurance sold off medical insurance and started investments in Management
Funds. Finally, in the year 2013, the company adopted the business of selling life insurances to
the clients. Tower Medical Life Insurance, Tower Managed Funds are the subsidiaries of the
umbrella company, Tower Limited.
The presence of skilled and professional members has enabled the company to establish a
firm customer base. Their dedication, commitment and perseverance helps in valuing the needs,
demands and requirements of the customers. The management team envisions reaching to the
benchmark level of performance by adhering and complying with the ethics and accountability
(Tower.co.nz, 2017). Herein, the development of standards and frameworks has proved
beneficial in terms of adopting the best practices to maintain order and harmony of the
workplace. Evaluation of the developed frameworks and structures has assisted the managers to
develop new governance structures for regulating the business activities in an efficient and
effective manner.

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A. Internal compliance requirements
The company operates under Fire and General Industry, therefore the three industrial
compliance requirements can be boat, house and car.
Internal compliance requirement number 1
Plus cover Policy
Aim
Make the insurance process easier and convenient for the customers.
Agency
Brochures, which provides in-depth information to the customers about the scope and
arena of the policy (Tower.co.nz, 2017)
Legislation
Plus cover policy has three different specifications in which the stakeholders can invest-
Premium cover; Plus cover and Standard cover. Under these insurance packages comes the
events, which the customers come across and the items used by the customers on a regular basis-
accidents, jewelleries, money, mobiles, children’s welfare among others. The list also includes
refrigerated foods, thefts among others. In order to claim this policy, the clients need to undergo
four steps. In the first step, the clients need to identify the damage and loss, which they have
encountered (Tower.co.nz, 2017). If the loss or damage is of high intensity, they are to inform
the police. In the second step, the clients are to check the policy wordings and collect the
necessary documents. After this, the personnel would brief the clients about the dynamics of the
policy. In the third step, the personnel actually lodge the claim of the clients, asking them the
additional information. This would be followed by the assessment of the feasibility of the claim

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in terms of the terms and conditions of the policy. In case the claim does not fit, the personnel
would provide justifications. In the final stage, the personnel would assure the clients regarding
the processing of their claims as early as possible. Along with this, they would promise to
intimate the clients with the latest updates of the claims (Tower.co.nz, 2017). If the clients do not
comply with the terms and conditions of the policy, the personnel possess every right to decline
any claims made (Tower.co.nz, 2017). 14 days time is given to the clients to send the last known
addresses, so that they can refund the unused premium.
Internal compliance requirement number 2
Marine Insurance Act (1906)
Aim
 To secure the life of the mariners from the sea risks
Agency
The clients can approach the Law Commissionaries in order to gain justice for the loss,
damages or accidents on seas.
Legislation
As a matter of specification, this act is for the mariners, who execute their business
activities by risking their lifes. Insuring their lives is an attempt to ensure the safety, security of
the mariner in sea. The clients have full opportunity to make claims for getting compensation
from the opposition parties, who have forcibly tried to conquer over the boats, properties and
other belongings (Legislation.govt.nz, 2017). The provision of contracts is additional assistance
for the clients in terms of fighting for their rights.

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APPLICATION
Marine Insurance act has been re-enacted by Tower Limited in terms of bestowing
quality lifestyle on the mariners. The personnel have added innovation to this act through the
renovative conglomeration of the Gambling Act (1845). The major drive behind this
conglomeration is to safeguard the mariners from the gambling mentality of the political parties.
One of the major activities of this conglomeration is the statutory prohibition of gambling with
the wages of the mariners. Strict measures are taken against the culprits in terms of fines and
imprisonment (Tower.co.nz, 2017).
Internal compliance requirement number 3
Consumer Insurance (Disclosure and Representations) Act 2012
Aim
 To maintain transparency in providing insurance to the consumers
Agency
 Disclosing the specific information of the legislation in the policy documents
 The helpline numbers
Legislation
Disclosing the specific information about the policies and legislation proves beneficial
for the personnel in terms of indulging in maintaining stable relationships with the clients.
Representation of the specifications in the brochures is a legal proof for the company in terms of
averting the illegal instances (Tower.co.nz, 2017). Adherence to this legislation helps the
personnel to ensure the wellbeing of the consumers by insuring their life. Within the disclosure,
the clients have the opportunity to make claims for the betrayals, deceives, loss and damages,

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which they have faced from the brands. There is a process, which Tower Insurance follows for
ensuring the safety of the clients. Complying with this process assists the victims and the
personnel to face any kind of illegal issues or crisis. (Tower.co.nz, 2017).
APPLICATION
The company implements this policy through the means of meetings and conferences
with the stakeholders. After gaining the approval of the stakeholders, the personnel evaluate the
achieved approaches in terms of the identified and the specified benchmark level of performance.
This evaluation helps in talking a firm stance on the policies and the legislations to be
implemented. Even after the implementation, evaluation is conducted in order to assess its
effectiveness in terms of the goals and objectives of the company (Tower.co.nz, 2017).
B. Internal compliance issue
Compliance requirement
In order to serve the stakeholders in an effective manner, the company complies with the
Privacy Act (1993). Compliance to this act helps the personnel to safeguard the stakeholders
from the instances like cyber crimes, being deceived through false promises among others. Here,
the compliance requirements are the contracts, which the stakeholders are encouraged to indulge
in. The government officials are hired for inspecting the whole process of formation of the
contracts till the closure (Tower.co.nz, 2017). Strict vigilance is applied on the employees
regarding their commitment to the policies, legislations and the terms and conditions of the
contracts. If the employees fail to omply with the standards of the legislations and policies, strict
actions are taken against them in terms of termination, making the contracts and claims invalid

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among others. Here, the main aim is to preserve the basic Right to Information for the customers.
This can be done by installing security software in the profiles of the customers. This profile
needs to be visited on a regular basis for assessing the presence of virus, malfunctions or hacker
interventions. This way, the personnel would be able to prevent the leakage of the private and
confidential information to the third parties. Conscious attitude is needed from the managers,
which would be valued if steps such as installation of security software are undertaken
(Tower.co.nz, 2017).
Impact of the requirement on the company
Adhering to the Privacy Act (1993) possesses enough flexibility for the attainment of the
loyalty, trust and dependence from the customers. Seeking innovative means for the sale of the
policies in such legal manners would increase the revenue of Tower Limited, adding value to the
profit margin. This would, in turn, expand the network chain, enabling the company to attain
foreign market penetration (Tower.co.nz, 2017).
Recommendation
Indulging in partnerships with the agencies, would help the company personnel to make
beneficial insurance plans for the clients. Along with this, making advertising and promotional
plans would help the company to maintain transparency with the clients in terms of selling the
policies and insurance. Keeping a track of the reactions of the clients would result in the
introduction of innovative schemes, offers and discounts on the purchase of policies and
insurances. Here, adopting the means of surveys and feedbacks would help the personnel to
produce customer-oriented services (Tower.co.nz, 2017).

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External compliance requirements
External compliance requirements in case of Tower Insurance Company are outsourcing,
partners and the shareholders like suppliers, distributors among others.
External requirement 1
Data Protection Act
Aim
 To maintain the privacy of the confidential details like the financial statements, codes
among others
Agency
Here, the agencies are the governmental law officials, who keep tracks of the data being
transferred from the company to the shareholders.
Legislation
For conducting the outsourcing activities, the Tower Insurance Company abides by Data
Protection Act (1998), Computer Misuse Act and the other IT legislations. Along with this, the
company has introduced privacy cookies, which ensures the safety, security and privacy of the
customers’ data. Uploading the privacy policies on the website enhances the knowledge of the
customers regarding the practices adopted by the company. Along with this, the managers keep a
track on the utilization of the computers by the personnel (Tower.co.nz, 2017). The managers
have access to every laptops and PCs provided to the employees. If it is found that the employees
are using them for reasons other than completion of the allocated tasks, strict actions are taken.