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## Vasquez-Morrell Assurance

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This topic has 2 expert replies and 5 member replies
vzzai Senior | Next Rank: 100 Posts
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#### Vasquez-Morrell Assurance

Tue Oct 25, 2011 5:33 pm

00:00

A

B

C

D

E

# Global Stats

Difficult

Vasquez-Morrell Assurance specializes in insuring manufacturers. Whenever a policyholder makes a claim, a claims adjuster determines the amount that Vasquez-Morrell is obligated to pay. Vasquez-Morrell is cutting its staff of claims adjusters by 15 percent. To ensure that the companyâ€™s ability to handle claims promptly is affected as little as possible by the staff cuts, consultants recommend that Vasquez-Morrell lay off those adjusters who now take longest, on average, to complete work on claims assigned to them.

Which of the following, if true, most seriously calls into question the consultantsâ€™ criterion for selecting the staff to be laid off?

(A) If the time that Vasquez-Morrell takes to settle claims increases significantly, it could lose business to other insurers.
(B) Supervisors at Vasquez-Morrell tend to assign the most complex claims to the most capable adjusters.
(C) At Vasquez-Morrell, no insurance payments are made until a claims adjuster has reached a final determination on the claim.
(D) There are no positions at Vasquez-Morrell to which staff currently employed as claims adjusters could be reassigned.
(E) The premiums that Vasquez-Morrell currently charges are no higher than those charged for similar coverage by competitors.

OA is B.
I went for D . Though it does not seems to be a good option but I didn't have to assume any outside knowledge to arrive at the solution. However, to arrive at B as the answer, we have to assume that most complex tasks handled by the claims adjusters take more time. But, If we assume that claims adjusters who handle complex claims are more efficient and take less time!, we won't arrive at the solution B.
I've searched over internet but the explanations were not convincing. Could someone explain why option B is more apt?

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Vj

GmatKiss Legendary Member
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Tue Oct 25, 2011 8:57 pm
[quote="vzzai"]Vasquez-Morrell Assurance specializes in insuring manufacturers. Whenever a policyholder makes a claim, a claims adjuster determines the amount that Vasquez-Morrell is obligated to pay. Vasquez-Morrell is cutting its staff of claims adjusters by 15 percent. To ensure that the companyâ€™s ability to handle claims promptly is affected as little as possible by the staff cuts, consultants recommend that Vasquez-Morrell lay off those adjusters who now take longest, on average, to complete work on claims assigned to them.

Which of the following, if true, most seriously calls into question the consultantsâ€™ criterion for selecting the staff to be laid off?

(B) Supervisors at Vasquez-Morrell tend to assign the most complex claims to the most capable adjusters.

(D) There are no positions at Vasquez-Morrell to which staff currently employed as claims adjusters could be reassigned.

We need a point to question on the validity of the decision.

D answers to the question : where there no other option for reassigning/retaining the claim adjusters, who were laid off?

B is bang on! - Questions on the decision ( for its validity )

vaibhavgupta Master | Next Rank: 500 Posts
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Thu Oct 27, 2011 8:11 am
vzzai wrote:
Vasquez-Morrell Assurance specializes in insuring manufacturers. Whenever a policyholder makes a claim, a claims adjuster determines the amount that Vasquez-Morrell is obligated to pay. Vasquez-Morrell is cutting its staff of claims adjusters by 15 percent. To ensure that the companyâ€™s ability to handle claims promptly is affected as little as possible by the staff cuts, consultants recommend that Vasquez-Morrell lay off those adjusters who now take longest, on average, to complete work on claims assigned to them.

Which of the following, if true, most seriously calls into question the consultantsâ€™ criterion for selecting the staff to be laid off?

(A) If the time that Vasquez-Morrell takes to settle claims increases significantly, it could lose business to other insurers.
(B) Supervisors at Vasquez-Morrell tend to assign the most complex claims to the most capable adjusters.
(C) At Vasquez-Morrell, no insurance payments are made until a claims adjuster has reached a final determination on the claim.
(D) There are no positions at Vasquez-Morrell to which staff currently employed as claims adjusters could be reassigned.
(E) The premiums that Vasquez-Morrell currently charges are no higher than those charged for similar coverage by competitors.

OA is B.
I went for D . Though it does not seems to be a good option but I didn't have to assume any outside knowledge to arrive at the solution. However, to arrive at B as the answer, we have to assume that most complex tasks handled by the claims adjusters take more time. But, If we assume that claims adjusters who handle complex claims are more efficient and take less time!, we won't arrive at the solution B.
I've searched over internet but the explanations were not convincing. Could someone explain why option B is more apt?
I used POE to reach B

stevennu Senior | Next Rank: 100 Posts
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Mon Jun 10, 2013 9:54 pm
I'm having major issues with this question. If we select B, don't we have to assume that more complex claims take longer to complete? If in the passage there was a sentence that said something along the lines of "complex cases take longer to complete" then I would select B all day long. However that is not the case. How should questions such as these be handled? Is there a degree of inference that must be made on critical reasoning questions? I was under the impression that you took the information presented to you from the passage and answered the questions without brining in any outside information or assumptions. Please help.

cd86 Senior | Next Rank: 100 Posts
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Mon Oct 21, 2013 11:12 pm
B is the answer. But i wonder,doesnt the arguement expect us to assume that complex work takes more time? But in actual life..this asusmption would not be so logical.Right? Comples work need not necesserily take more time.

Can some one clarify?

### GMAT/MBA Expert

David@VeritasPrep GMAT Instructor
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Thu Oct 31, 2013 4:49 pm
Choice B does not require any sort of illogical assumption. There is an official GMAT question that requires us to assume that tall buildings are built on expensive ground. Or that land values are high when tall buildings are built there. Either way it is a reasonable assumption.

This is also a reasonable assumption. More complex cases logically would take more time on average. It does not mean every complex case takes longer. But the very definition of complex seems to imply that the case would take longer.

This question is not unreasonable and B is the correct answer.

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Save $100 off any live Veritas Prep GMAT Course Enroll in a Veritas Prep GMAT class completely for FREE. Wondering if a GMAT course is right for you? Attend the first class session of an actual GMAT course, either in-person or live online, and see for yourself why so many students choose to work with Veritas Prep. Find a class now! Anaira Mitch Master | Next Rank: 500 Posts Joined 26 Oct 2016 Posted: 206 messages Followed by: 3 members Upvotes: 3 Mon Mar 27, 2017 5:05 am Can any expert explain this problem. I am not able to understand How B is an answer to this problem. ### GMAT/MBA Expert DavidG@VeritasPrep Legendary Member Joined 14 Jan 2015 Posted: 2667 messages Followed by: 120 members Upvotes: 1153 GMAT Score: 770 Mon Mar 27, 2017 5:23 am Anaira Mitch wrote: Can any expert explain this problem. I am not able to understand How B is an answer to this problem. Imagine a very simple scenario that captures the texture of the logic. You and I are a two-person firm. You are extremely competent and professional. I am less so. Now imagine that our company has two cases, one that is incredibly complex and difficult and a second that is very straight-forward. It stands to reason that you'd take the hard case and I'd take the easy one, right? But it's also true that you'll likely need to spend more time on your case, as its complexity demands greater attention. Now an outside consultant comes in, sees that you spent way more time on your case than I spent on mine and decides that the company should keep me but not you. That's a pretty terribly decision, right? You didn't take longer because you're a slower worker. You took longer because you're a better worker, and therefore received the more complex, time-consuming case. Same idea here - if the best workers are taking on the longest, most time-consuming cases, the last thing we want to do is fire the people who take the longest to complete their assigned tasks. _________________ Veritas Prep | GMAT Instructor Veritas Prep Reviews Save$100 off any live Veritas Prep GMAT Course

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