EFU-GENERAL INSURANCE COMPANY

Samina Afzal Mi12bba058Arooj Toufique Mi12bba001Iram Munawar Mi12bba010Muqaddas Iqbal Mi12bba011

Team Members:

EFU Stands forEASTERN FEDERAL UNION

INTRODUCTION Of EFU-GENERAL INSURANCE

EFU General Insurance company was Formed in 1932. EFU gave the emerging insurance industry the Leadership, the Manpower and the Drive needed to grow in a situation, where at one time three fourth of insurance was held by foreign companies.

Story

1932 “Our Beginning”In Kolkata (Calcutta) the Eastern Federal Union Insurance Company was established with financial assistance from the Aga Khan and the Nawab of Bhopal.

1947 “Pakistan Our New Home”On the birth of Pakistan EFU rapidly established itself as a progressive and innovative insurer.

1961 “Father of Insurance”EFU had become the flag bearer of Pakistan's insurance industry on the world stage, and the largest life company in Afro-Asian countries (excluding Japan) under the leadership of (Late) Mr. Roshen Ali Bhimjee.

1982 “Golden Jubilee Year”EFU celebrated its Golden Jubilee in 1982 - a memorable event in the history of Pakistan's insurance industry.

1990 “A Billion Rupee Company”EFU General became a Billion Rupee Company under the leadership of Mr. Saifuddin N. Zoomkawala, Managing Director & Chief Executive, a highly talented leader with international experience.

1992 “EFU Life Launched”The Life Industry was opened to private sector and EFU Life was born in 1992.

1996 “EFU House Lahore”The EFU House designed by the famous architect Mr NAYYAR ALI DADA was built giving a new look to Lahore’s historic skyline.

2000 “Pakistan's First Specialized Health Insurer”Pakistan’s first specialized health insurance company , ALLIANZ EFU was established at a joint venture with Allianz AG of Germany.

2001 “EFU Story – Chronicled”Two books namely “ROSHAN ALI BHIMJEE” between tears and laughter and “THE EFU SAGA” were launched.

2005 “A Billion Rupee Branches”Two Branches “CENTRAL AND SITE DIVISIONS” became billion rupee branches.

2002 “EFU House, Karachi”KARACHI’S HISTORICAL LANDMARK, Qamar house was acquired to symbolize EFU group’s foundation and from now on will be known as EFU House.

2007 “EFU 75 Years”The largest insurance group proudly celebrates 75 years of committed excellence.

2008 “Corporate Excellence Award”EFU was the recipient of 24th corporate excellence award by Management Association of Pakistan.

2011 “Bancassurance and Co-Brand Credit Card Launched”EFU Life and Askari Bank launched bancassurance and co-brand credit card.

“Our vision is to be the first choice company for our customer, shareholders and employees.To achieve this we will be driven by an obsession to be better than the best in a continuous journey, not a destination.”

We will manage our affairs through modern technology,collective wisdom and institutionalized leadership. Wewill be a respected, cultured and an educated companywith a strong market position. Together with ourcustomers, reinsurers and employees, we will achieveworld class quality standards through continuous qualityimprovement. We will do good business, with good clients and of the highest integrity. We will not compromise our principlesand we will like to be known as a responsible corporatecitizen aware of our obligation to the Government andthe society we serve.

CORPORATEPROFILE

EFU HOUSEKARACHI

EFU HOUSE LAHORE

Kotli (AK)

2

JhelumMandi Bahauddin

1

1

1

Attock2

1

1

1

Gujrat

1

1

2

10

2

1

2

1

3

418

11

1Khanpur

1Jacobabad

1Dera Allahyar

1

1Dharki

1 Ghotki

1 Khairpur

2Larkana

1Naushero Feroze

1Nawabshah

Mirpurkhas

1

1Hub

Thatta

12

1

1

All Over Pakistan

AWARDS

EFU PUBLICATIONS & MEDIA CENTER

Total Premium income of the EFU Group in 2011

PKR 14.5Billion

Largest Private

Sector Life Company

Largest General Insurance Company

First Specialized

Health Insurance Company

• AVIATION• BOND• MARINE • MISCELLANEOUS• MOTOR• ENGINEERING• Fire• PROPERTY• Risk

Management

PODUCTS AND SERVICES

Aviation

aviation: failure of a component

manufactured by a small company may result in the loss of a fully loaded airliner.

such catastrophic loss may arise it is normal for aviation risks to be excluded from many kinds of general insurance policy.

BUYERS OF AVIATION INSURANCE Commercial Aircraft Operators Corporate and Business Aircraft Operators Aerial Work and Air Taxi Operators Private Owners and Flying Clubs Air-Craft Manufacturers Owners and Operators of Air-Ports, Hangers Aircrew Passengers Shippers of Goods by Air Lessors (Banks, Financial Institutions) Hang Gliders Conventional Gliders, Balloons and Hovercraft

TYPES OF COVERS OFFERE:

1. Aviation Hull All Risk2. Hull War and Hijacking3. Spare Engines& Spare All Risk4. Legal Liability to Passengers5. Legal Liability to Third Parties6. Legal Liability to Cargo7. Legal Liability to Mail8. Comprehensive Gen. Liability9. Loss of License10.Personal Accident

Bond

Bond A bond is not a policy of

insurance but is in effect a form of financial guarantee.

It is a guarantee by one party

(the surety or guarantor) to another party (the body requesting the bond) that a third party (the company requiring the bond) will meet its contractual obligations.

Advantage:1. Charges on company assets are not generally requested 2. No reduction upon the company's borrowing facility will

be imposed. Requirment for bond insurance:

3. Three years financial audited account for the applicant company

4. Three years consolidated audited account for the ultimate holding / parent company in addition to the above if the company is owned by another company

5. Full details of the circumstances in which the bond is required, including a copy of the bond wording and the bond amount

Types of Bond Offered:

• Bid Bond • Performance Guarantee

Bond • Mobilization Advance Bond • Retention Money Bond • Excise Bond • Supply Bond

Marine insurance:Marine Insurance is classifies into two parts as:

Marine Cargo; and Marine Hull

1)Marine Cargo:

"Marine Insurance is said to be Mother of all Insurances”. In Marine Insurance coverage is provided for goods in transit for both Import and Export and the mode of conveyances on waterways (sea), air and land routes.• Import The goods are covered from warehouse to

warehouse the contract is usually on C&F (Cost & Freight) and CIF (Cost, Insurance & Freight) basis.

• Export The contracts can be CIF (Cost, Insurance & Freight) and FOB (Freight On Board) basis

• . Inland Transit The goods are covered from anywhere in Pakistan to anywhere in Pakistan.

2)Marine Hull:EFU General Insurance offers different types of risks coverage for the hull (structure) of Vessels and aircrafts as bellow:

Construction Risks:During the period of the construction of a vessel, it may be insured with an insurance company familiar with handling of such insurance. Due to the fact that a Ship-owner's Yard is essentially a static, non-marine risk, it is possible that basically non-marine insurer will take on the risk of covering a vessel while it is under construction, but generally it is unsatisfactory.

Period of Insurance:The customary practice is to affect Hull policies for a period of 12 months. The clauses contain, however, the "Continuation Clause" which provides that if at the expiration of the policy the vessel is at sea, or in distress, or at a port of refuge or of Call, the vessel shall, provided previous notice is given to the underwriters, be held covered at a pro-rata monthly premium to her port of destination.

Additional Insurance:Additional covers are also provided by EFU which are not included in standard policy. Institute War and Strike Clauses — Hulls — Time Institute Time Clauses — Hulls: disbursements and

increased value (total loss only, including excess liabilities) Protection and Indemnity Associations Liabilities in respect of Seamen Liabilities in respect of Passengers Liabilities in respect of Third Parties Liabilities arising from Collisions Liabilities arising from Pollution Liabilities arising from Wreck Removal General Average

Other Risks:

o Group Personal Accident o Personal Accident cover for individual persons o Family Package gives a discount when the whole family

buys one policy o This policy will provide compensation in the event of

Death, Permanent Disability or Temporary Disability due to an Accident. Coverage is worldwide. We can add extra coverage that will pay for medical expenses resulting from an Accident.

motor

MotorEFU offers insurance protection with wide variety of variations and combinations meeting the insurance need of our clients, a few of MOTOR PRODUCTS are:

• Private Vehicle• Commercial vehicle

1)Comprehensive Insurance: This is the widest form of cover, our client is protected against financial losses of all kinds, accidental loss to vehicle.

2)Third Party Motor Vehicle Insurance: Our client is protected against all financial losses due to accidental damage liability of all forms to third party, property damage or bodily injury, death or both

3)Act only Liability Insurance:The cover meets the minimum legal insurance requirement. It offers protection against financial losses due to liability of accidental bodily injury or death to third party.

Extra benefits:

Family Accidental Benefit Cover Accidental Death Cover for Salaried

Driver: Protection of Loan Amount for

Financial Institutions: Personal Accident Benefit Cover for

Passengers: 20% Discount in Premium on

Installation of Trakker Device

property

Property insurance:EFU covers both medium and large industrial and commercial risks relating to property, including energy complexes.

Combined Policy: A combined policy is one where separate sections are brought together to create a policy which is specific to the needs of the organization insuring.

Package Policy: The package policy contains a number of different sections e.g. fire, accidental damage, glass, theft, third party liability, employers liability…….

Single Policy: The single policy on the other hand is one where only one type of cover is provided such as fire policy or a theft policy; single policies are however, becoming rarer since the combined policy can be adapted to suit most needs of an organization. Property Insurance is further divided into two segments as:

FireEngineering.

fire

Fire insurANCE:EFU Insurance writes a portfolio comprising a broad spread of quality business relating to industrial, commercial and service activities, including transportation, oil production, manufacturing, engineering, banking, and other miscellaneous services. The business written ranges from simple commercial property risks to the largest and most sophisticated industrial and energy risks.

Perils in Standard Fire Policy:The Standard Fire policy can be issued with allied perils such as: -

1) Riot and Strike Damage:EFU will indemnify the policyholder’s loss arising out from such kind of situation. The Riot and Strike cover exclude the damages of war, invasion, act of foreign enemy, hostilities or warlike operations civil war, Mutiny and civil commotion.

2) Riot and Fire Damage:The act of any person or persons taking part together with others in any disturbance of the public place whether in connection with a strike causing loss or damage to the property by Fire directly.

3) Atmospheric Disturbance:The risk of Atmospheric Disturbance can also be added in Fire Insurance policy. The risks of atmospheric disturbance provide the protection against the damages of Hail, Snow, Wind, Hurricane, Cyclone, Tornado.

5) Explosion:Loss or damage to the property insured under the risk of Fire or otherwise directly caused by explosion.

6) Earthquake:EFU gives cover for both fire and shock damage caused by earthquake. If required either can be insured on its own, at a lower premium.

7) Terrorism:The use of violence for political ends and includes any use of violence for the purpose of putting the public or any section of public in fear causing damages properties and lives of human by making explosions or otherwise directly caused by an act of terrorism committed by a person.

8) Burglary Insurance:Any property belonging to a business or house held stolen from the business premises or from the house, In such cases the matter must be reported to the police in writing and after entry of the report the insured must obtain a certified copy of F.I.R. from the concerned police station.

Engineering

ENGINEERING

1) Eraction All Risk Insurance: Erection All Risk Insurance offers comprehensive and adequate protection during the period and stages of erection of the machinery, plant and steel structures

2) Contractor All Risk Insurance: Contractor All Risks Insurance offers comprehensive and adequate protection against loss or damage in respect to contract works of civil engineering projects, construction plant and equipment and construction machinery as well as third party claims in respect of property damage or bodily injury

3) Contractor Plant and Machinery Insurance:This policy is developed for the contractors. It offers comprehensive insurance to contractor's plant and machinery on an annual basis. It offers loss or damage occurring at work, at rest or during maintenance

4) Machinery Loss of Profit (MLOP) Insurance: This policy provides cover for actual loss of gross profit sustained as a result of a business interruption caused by an accident indemnifiable under machinery insurance.

5) Boiler and Pressure Vessel Insurance (Machinery): Boiler is an integral part of many plants. Boiler is a device which produces steam under high pressure and temperature. Boiler is an expensive equipment and always contain risk of explosion and collapse. Boiler explosion not only destroy the boiler itself but cause catastrophic damage to surrounding property and machines

6) Electronics Equipment Insurance: EEI is today a common policy for high valuable electronic equipment. The term electronic equipment comprises all electrical systems Electronic data processing ( EDP ) equipment Electrical and radiation equipment for medical use Communication facilities

7) Comprehensive Machinery Insurance Policy: Power and steel plants, paper, cement factories, sugar mills or other industry with a high exposure to machinery damage but a lower exposure to fire, explosion and natural hazards are insured under this policy

8) Comprehensive Project Insurance Policy: The Comprehensive Project Insurance policy is applicable to erection and construction projects, but it is particularly relevant to risks such as hydroelectric plants which involve both construction works and machinery erection

MISCELLANEOUS

1)Workman’s Compensation Insurance:The Workmen's Compensation Act provides no-fault benefits in the event of death or injury to a 'Workman' (normally with an income of less than PKRS 3,000 per month) due to an accident at work

2) Traveler’s Accident and Hospitalizations (Sickness) Insurance:When someone travels to another country, he may find himself in financial trouble in the event that he suddenly falls ill or incurs hospitalization expenses due to unexpected sickness or an accident.

3) Liability Insurance:

Public Liability Insurance Product Liability Insurance Employer's Liability Insurance General Professional

Indemnity:

4) Money Insurance:Cash in Transit / Cash in Safe Insurance A business may be robbed of cash either during normal business hours or after normal business hours. Money may be stolen whilst in transit between the bank and the office or on any other route. Our Cash in Transit, Cash in Safe and Cash in Drawers policy will compensate the business for such loss.

5) Plate Glass Insurance:

. This applies particularly to retail shops, department stores, showrooms, etc. where shop fronts and window displays play an important role in attracting business. The Glass Policy may be extended to cover special types of glass which are very expensive to replace such as silvered, wired, ornamental, stained, lettered, toughened and armoured glass

Risk Management: Risk Management is the combinationof the two words, “Risk” and “Management”.The word “Risk” is defined in many ways as:“Risk” is the possibility of an unfortunate occurrence.“Risk” is a combination of hazards.“Risk” is unpredictability – the tendency that actual results may differ from predicted results.“Risk” is uncertainty of loss.“Risk” is the possibility of loss.

“Management” is the common term which means “handling”.So we say that the “Risk Management” is the process to best handle uncertainty about whether losses will occur”.

Risk Management process is a process of four logical steps as:

1. Identifying and Analyzing Loss Exposures

2. Examining the feasibility of alternatives

3. Selecting the techniques4. Monitoring Results

Does EFU also offer risk management training?

Depending upon the request, we hold specific risk management seminars for our business partners. After an introduction to the theory of risk management, the practical side is demonstrated by means of a case study. The participants then have a chance to make risk management decisions and to analyze these in the course of workshops.

What do EFU's services cost?

These highly individual services exceed the scope of what we normally offer our clients and therefore cannot be provided free of charge. However, at EFU we charge you nothing.

Whom do you approach for risk management services?

The "Risk Management" Central Office of EFU: Head Office - will be glad to receive your orders. It is responsible for coordinating and supervising the work that will be done on your behalf. This concentration of activities in one central office is of great advantage to you. Our branches with which you have dealt previously will also be pleased to help in passing on your requests to our risk management specialists.

What happens if the concrete Risk Management analysis indicates the need for coverage that is not normally available on the market?

We work together with you to try to find a viable solution. Provided that the risk does not exceed the borders of what can be considered insurable and provided that sufficient capacity is available, we are prepared to offer insurance for difficult and unconventional forms of cover, assuming of course that we are able to agree on the premiums and conditions.

FINANCIALHIGHLIGHTS

Major Losses Paid Sr. No Insured Loss Amount

1 Maxco (Pvt) Ltd 616,997,5042 Novatex Limited 600,000,0003 Dawlance [Pvt] Limited 445,874,8574 Novatex Limited 360,610,0535 Al-Abbas Cement 300,000,0006 Dewan Salman Fibre Ltd 300,000,0007 Olympia Spinning & Weaving 260,750,4348 Arzoo Textile Mills Ltd 250,000,0009 Pakistan Oilfield Ltd 237,378,93310 Indus Jute Mills Ltd 176,967,50211 Metatex (Pvt) Ltd 149,594,24012 Novatex Limited 137,031,82313 Liberty Mills Limited 101,338,80014 Vikor Enterprises (Pvt) 96,128,00015 Hajra Textile 87,000,00016 Descon Eng 85,000,00017 Descon Eng 69,400,00018 Al-Abid Silk Mills Limited 54,489,01919 Central China Power 50,000,00020 Gray Mackenzie Restaurants 50,000,000

14,698

5,452

15,818

02,0004,0006,0008,000

10,00012,00014,00016,00018,000

Competitor 1 Competitor 2 EFU

Total Assets

8,062

2,410

8,927

0

2,000

4,000

6,000

8,000

10,000

12,000

Competitor 1 Competitor 2 EFU

Investments

42%

29%29%

14%

32%

24%28%

20%

0%

10%

20%

30%

40%

50%

EFU Market

2008 2009 2010 2011

Growth PercentageEFU vs Market

117%

297%

387%

0%50%

100%150%200%250%300%350%400%450%500%

Net Premium

Competitor 1 Competitor 2 EFU

Growth Percentage (Last Five Years )

Top Three Players

Business Spread

Property, 26%

Motor, 52%

Marine, 13%Misc, 9%

Competitor 129%

Others30%

Competitor 29%

EFU32%

Current Market Share

Rank Insurance Company Premium.

Written

Market Share

1 Adamjee Insurance 9.38 27%

2 EFU General Insurance 8.96 25%

3 National Insurance CO

Ltd

4.25 12%

4 New Jublee Insurance 3.43 10%

  Sub Total 26.02 74%

  Others 9.27 26%

  General Total 35.29 100%

Top Four Companies

Strengths

Threats

Weakness

Opportunities

SWOT ANALYSIS

Skilled employees Technical services Diversified in nature Quick claim procedure. Voluntary review mechanism by professionals of

international repute Relationship with its main reinsurer, “Munich Re”

• Low satisfaction of the

employees

• High rate of premium

• Lack of technical staff

• High turnover rate

• Global organization

• High rate of growth

• Progressive attitude towards the success

• Leading competitor

• Brain drain of EFU

• Financial and political instability

• Lack of awareness

• Low rate premium companies

RECOMMENDATIONS

Online Claim Services Websites Regarding to Policies Mobile Insurance HR Department Unique Products Increase in Product Distribution Proper Feedback

Increase in Salaries

Opportunities about Insurance

New Technology

Insurance through Internet

Management System

RECOMMENDATIONS

CONCLUSION• The significant improvements in terms of its

results in comparison to the previous periods have been in line with the expectations.

• Most of the staff members are young and energetic

• Innovative products of EFU have capability to attract more customers but awareness of these products must be created in the minds of people at first.

• Teamwork and Joint operation system in that area may contribute a lot and that’s why they are influencing the environment.

• Customer satisfaction is the main goal of EFU.• In a nutshell, the performance of this branch is

satisfactory by and large but still there is a room for improvement as THE BEST is not an end of any thing according to my views..