Insurance Industry Analysis

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    CHAPTER 1

    GENERAL INTRODUCTION

    SERVICE SECTOR

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    1.1)Services Sector in Global ScenarioT

    heres growing recognition that services do matter to developing countries.The global services sector is undergoing a revolution that enables small firms in

    these countries to compete in world markets. ITC, reacting to the explosive

    growth of trade opportunities, has upgraded its programme to equip exporters

    with all they need to tackle competitive international markets.

    As globalization drives a sea change in trading activities, ITC is working to boost

    service providers participation in international business. It is helping to highlight

    to a wider range of sectors the variety of services they could export. Sectorassociations and chambers, supported by ITC, are getting the Its time to export

    message out to services companies, particularly small and medium-sized

    enterprises (SMEs) in non-OECD (Organisation for Economic Co-operation and

    Development) countries.

    The revolution in services sector exporting has come about despite a traditional

    misunder-standing of its potential. Governments and business associations have

    tracked trade in the multifaceted services sector inadequately (see related box on

    missing exports). Further, the intangible nature of services where promises

    rather than goods are being sold has meant that service providers, often small

    businesses, are not aware of the fact that they are exporting.

    Some years ago, a developing economy policy-maker or business-person looking

    at export opportunities in services might have concentrated on transport and

    tourism. They might also have expected to export labour services. However,

    recent developments in technology and in the organization of international

    business have broadened the scope of developing economy interests. Moreover,

    this year, negotiations on services commitments in the GATS have recommenced.

    This article outlines some issues for decision-makers to consider and a series of

    related research projects to initiate, as they respond to shifts in the market place

    and as they plan their approach to the services negotiations. The opportunities

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    for developing economies in services markets were highlighted recently by the

    Global Services Network (GSN). This group identified a number of areas in which

    developing economies have gained a foothold in knowledge based and labor-intensive services. GSN concluded that entry into these markets was facilitated

    by the opportunities created by new information technologies and subsequently

    by ecommerce. GSN cited the experience of some economies in establishing data

    processing sectors, or call centres, as well as software supply groups.

    In these cited examples, services were provided in the cross border mode of

    supply, that is, without the movement of either producer or consumer. GSN went

    on to list other areas which are ripe for cross border trade.

    These areas included:

    Software programming;Data capture and repair;Management of electronic medical records;Translation services;Technical online supports services;Database management;Research & development;Inventory management;Website design and management;Medical transcription;Legal transcription;Back-office services for airlines, brokerage firms, and credit card processing.

    UNCTAD, for some time, has worked on the scope for developing economies to

    expand services exports through all modes of supply. The UNCTAD secretariat

    (1998) paper examined how globalization, liberalization and new information

    technologies are providing new opportunities for trade in services. Case studies

    included computer services, back office services, environmental services, health

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    care services and tourism services. Moreover, UNCTAD has undertaken a series of

    expert group meetings in relation to these services.

    Many issues are involved in expanding the ability of developing economies to take

    advantage of the emerging opportunities in the services sector. Market access is

    one issue. But also the openness of domestic services markets can help build the

    capacity to participate in global markets. Liberalization increases the efficiency of

    the operations of suppliers in intermediate services to all export sectors.

    Liberalization also brings in capital and technology. New business opportunities

    are not only influenced by policies affecting market access at home and offshore,

    but also by other national policy initiatives.T

    he effective participation ofdeveloping economies in the current services negotiations will be a contributing

    factor to maintaining reform in the services sector. A number of papers, including

    those by Hoekman and Messerlin (1999), Mashayekhi (2000), Mattoo (2000),

    Hoekman (1999) and Sauve (2000), have discussed the priorities in the developing

    economies agenda in these negotiations.

    Apart from participation in multilateral negotiations and national policy

    initiatives, there are other elements in a portfolio of strategies for services

    development. These include the use of regional strategies and regional

    cooperative arrangements. These are topical and there is considerable work in

    progress in the application of regional arrangements. Important groundbreaking

    work, for example, is in progress in APEC.

    1.1.1)Pivotal role for servicesA growing recognition, however, of the pivotal role services play in all economies

    and a shift in understanding how services should be packaged, marketed, sold and

    reported, have sparked interest from exporters and trade development officials

    worldwide that continues to gain momentum. The changes have been accelerated

    by the digital revolution of the 1990s, which opened powerful new mechanisms

    to ease trade in services. The sector also advanced thanks to the agreement of a

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    definition of trade in services achieved under the Uruguay Round negotiations on

    the General Agreement on Trade in Services. ITC, recognizing the growing

    potential for developing country firms, moved quickly to integrate trade inservices in its global activities.

    Traditionally, ITC provided publications and training to support export

    development for the services sector. Now, with multi-donor support, the

    organization has developed well-rounded technical assistance programmes to

    better support the development of cross-industry capacity in services exports,

    notably for SMEs in the developing world. ITC has developed a six-phase

    programme to boost the export of services in target countries.T

    he culmination ofthe programme sees a country joining ITCs Service Export Network. The

    programme includes steps to:

    y conduct a capacity study and develop a services association database;y establish local champions and conduct association surveys;y create web portals to connect the beneficiary countries;y deliver train-the-trainer workshops to SMEs, services associations,

    chambers of commerce and governments;

    y organize regional networking meeting for associations; andy advise governments on their role in promoting trade in services.

    Feedback from countries implementing the programme around the world has

    enabled ITC to identify and address specific issues. Targeting women service

    exporters for assistance is one. Worldwide, 86% of women entrepreneurs are in

    the services sector. However, very few women originally participated in ITC

    services export workshops. In response, it made a conscious effort at the country

    and regional level to invite businesswomen to meetings, mainly through their

    associations. As a result of this initiative, some 30% to 40% of workshop

    participants are now female. Additionally, ITC has developed a directory of

    women entrepreneurs associations to encourage international networking of

    businesswomen.

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    Reflecting on ITCs new focus and activities to support services exports, Peter

    Walters,D

    irector of ITC

    sD

    ivision of Product and MarketD

    evelopment,comments: Even in a limited time period, we have worked with our partners to

    create an awareness that service exports do matter to developing countries. This

    is particularly the case in some small island state economies, where service

    exports including tourism are a real hope for the future, given the decline

    of the agricultural sectors and the lack of manufacturing in many of these

    economies.

    The growing recognition of the importance of services has resulted in a new driveby governments, export promotion bodies and business groups to build national

    and regional capacity to facilitate trouble-free services exports. The examples

    below highlight the diversity of services exports on offer:

    y A Malaysian civil engineering consultancy sells computer-aided designservices to companies establishing new plants on an Indonesian industrial

    estate.

    y A Chilean interior design company assists a Costa Rican resort to create apro-ecology feel for its luxury guest bungalows.

    y An Australian engineering company designs waste-oil catchment systemsfor petrol stations in Thailand.

    y An Indian data company provides credit card processing for an Italianconsumer finance company.

    1.1.2)Capturing benefits of liberalizationIn the developing economies, service firms should begin to benefit from more

    competitively priced services. For example, in the financial and

    telecommunication sectors, WTO negotiations have already seen commitments to

    further liberalization which will drive prices down as competition picks up. The

    strengthened protection afforded to intellectual property rights under the WTO

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    Agreement on Trade-Related Intellectual Property Rights (TRIPS) should benefit

    both local and exporting service firms.

    However, liberalization also brings with it increased competition for domestic

    service firms. The very technology that allows developing country firms to deliver

    services to distant export markets will also enable distant providers to deliver

    services to local economies. As such, even domestic service firms will need to

    begin formulating strategies within a global context.

    The export of services from developing countries is here to stay. Recent research

    has highlighted that already all developing countries export, on average, more

    than 60 services to more than 30 different markets. However, most of the

    countries studied remain unaware of this growing trade. Clearly, the key to

    capitalizing on these new opportunities is to build awareness and to ensure

    training for best practice approaches through collaboration with service

    provider associations and governments. ITCs technical assistance programme,

    formulated to promote this type of approach, will be a critical foundation for

    services exporting success in many developing countries.

    1.1.3)The powerful growth of the global services sectorIn 2001, international trade in services exceeded US$ 1.4 trillion. In the period

    from the mid-1980s to the start of the new millennium, the services sector was

    the fastest growing component of world trade. Services make up a major portion

    of economies worldwide, including those of developing countries, ranging from

    39% of gross domestic product (GDP) in a country like Nigeria to 89% in

    economies such as Hong Kong, China. Service industries are becoming particularly

    important in least developed countries and usually contribute to at least 45% of

    GDP. The rapid expansion of service industries leads to impressive job creation

    rates that assist in rolling back poverty. Services usually make up one-quarter of

    inputs for efficient value-added primary industries. This makes strong service

    growth particularly important for developing countries in which primary sectors,

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    such as forestry and extractive industries, remain dominant.

    Some analysts predict that by 2020, services will account for 50% of worldtrade, says ITCs Peter Walters. One of the main reasons for the exponential

    growth in services we have witnessed and for that which is predicted is the

    progress in telecommunications and information technology. These

    developments have brought a proliferation of new opportunities for the sector

    and have played a major part in changing the way services are viewed and sold.

    Another key message from ITC is that You are never too small to export

    services. You can be a one-person firm and still be a successful exporter, heexplains.

    1.2)Service Sector In IndiaThe services sector has been at the forefront of the rapid growth of the Indian

    economy, contributing nearly 63 per cent of the GDP in 2007-08. The sector has

    come to play an increasingly dominant role in the economy accounting for 59.6

    per cent of the overall average growth in GDP in the last eight years between

    2000-01 and 2007-08.

    As per the Central Statistical Organization, the services sector has continued to

    grow in the second quarter of 2009-10.

    y Trade, hotels, transport and communication grew 8.5 per cent in July-September 2009 from a year earlier.

    y Financing, insurance, real estate and business services grew at 7.7 per centin July-September, 2009 from a year earlier.

    y Community, social and personal services grew at 12.7 per cent in July-September, 2009 from a year earlier.

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    Despite economic slowdown, 12 out of 31 service segments have registered high

    to excellent growth rate ranging between 10per cent to over 20per cent during

    the period of recession.

    The strong contribution of these service segments have helped India to maintain

    a healthy growth rate as service sectors contributes 63per cent in Gross Domestic

    Product (GDP) of India.

    Indian Telecom sector emerged as the biggest contributor by marking a significant

    growth rate in broadband, mobile and Internet subscription services. The

    broadband subscription grew up by 87per cent as against last years 23.6per cent;

    the mobile subscription increased by 50per cent as against previous fiscals 58per

    cent, while internet subscription registered a growth figure of 26 percent in

    comparison to previous years 20 percent.

    Among other major achievers, Indian Railways, IT software services, organized

    retail trades, franchising, forex earnings through tourists, education, housing

    finance, and media & entertainment sectors have also registered 10 to 20 percent

    growth rate.

    Indian Railways, the biggest revenue earners among these, have recorded 12.2

    percent growth in passenger traffic (as against 14 percent last year) while revenue

    through freight has increased to 15.7 percent as against 14 percent in the last

    fiscal.

    IT software services have also shown moderation in growth but managed to grow

    with positive figures by marking a growth rate of 15 percent while it was 33

    percent growth rate in the last fiscal.

    Besides, Forex earnings from tourist grew by 16per cent, housing finance by 12

    percent, organized retail trade by 15 percent and entertainment & media industry

    by 10 percent. The cargo services through road, rail and port have registered a

    single digit growth.

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    Meanwhile, sectors like airlines, insurance, mutual fund, and fixed line subscriber

    have witnessed sharp decline. A large number of fixed phone connections have

    been disconnected this year due to massive growth rate in mobile phoneconsumers.

    1.2.1) Indicators

    Lead indicators suggest that the pace of expansion in the services sector activity is

    likely to be sustained even in the next financial year.

    y Foreign tourist arrivals (FTAs) during calendar year 2009 were 5.10 million.y Railways freight traffic increased to 833.03 million tonnes during fiscal

    2008-09 from 794.21 million tonnes carried during 2007-08, an increase of

    4.89 per cent.

    y The number of telecom subscribers in the country increased to 562.21million in December 2009, an increase of 3.5 per cent from 543.20 million

    in November 2009. With this the overall tele-density (telephones per 100

    people) has touched 47.89.

    y

    Cargo handled at major ports during AprilDecember 2009 2010 has been

    411.95 million tones as against 391.82 million tonnes in the corresponding

    period in the previous fiscal.

    The prospects for growth in the Indian services sector continues to be robust,

    according to a survey by KPMG, conducted across the BRIC (Brazil, Russia, India

    and China) countries in the spring of 2009. The survey revealed that 31.3 per cent

    of Indian companies saw their activity levels improving. Around 37 per cent

    forecast new order growth in one years time, compared with 16 per cent that

    anticipated a fall. Even capital expenditure at Indian services firms is anticipated

    to rise, with 43 per cent of companies saying they plan to increase spending on

    fixed assets.

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    According to a HSBC survey, business activity among Indian services companies

    expanded at its fastest pace in 16 months in January 2010, rising for a second

    straight month on a sharp increase in new work orders.

    The HSBC Market Business Activity Index, based on a survey of 400 firms, rose to

    58.96 in January 2010, its highest since September 2008. (A reading above 50

    represents expansion while anything below points to a contraction)

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    CHAPTER 2

    INTRODUCTION OF INSURANCE SECTOR

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    The insurance sector in India has come a full circle from being an open

    competitive market to nationalization and back to a liberalized market again.

    Tracing the developments in the Indian insurance sector reveals the 360-degree

    turn witnessed over a period of almost two centuries.

    2.1) A Brief History of the Insurance Sector

    The business of life insurance in India in its existing form started in India in the

    year 1818 with the establishment of the Oriental Life Insurance Company in

    Calcutta.

    Some of the important milestones in the life insurance business in India are:

    y 1912: The Indian Life Assurance Companies Act enacted as the first statuteto regulate the life insurance business.

    y 1928: The Indian Insurance Companies Act enacted to enable thegovernment to collect statistical information about both life and non-life

    insurance businesses.

    y 1938: Earlier legislation consolidated and amended to by the Insurance Actwith the objective of protecting the interests of the insuring public.

    y 1956: 245 Indian and foreign insurers and provident societies taken over bythe central government and nationalised. LIC formed by an Act of

    Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from

    the Government of India.

    The General insurance business in India, on the other hand, can trace its roots to

    the Triton Insurance Company Ltd., the first general insurance company

    established in the year 1850 in Calcutta by the British.

    Some of the important milestones in the general insurance business in India are:y 1907: The Indian Mercantile Insurance Ltd. set up, the first company to

    transact all classes of general insurance business.

    y 1957: General Insurance Council, a wing of the Insurance Association ofIndia, frames a code of conduct for ensuring fair conduct and sound

    business practices.

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    y 1968: The Insurance Act amended to regulate investments and setminimum solvency margins and the Tariff Advisory Committee set up.

    y 1972: The General Insurance Business (Nationalization) Act, 1972nationalised the general insurance business in India with effect from 1st

    January 1973.

    y 107 insurers amalgamated and grouped into four companies viz. theNational Insurance Company Ltd., the New India Assurance Company Ltd.,

    the Oriental Insurance Company Ltd. and the United India Insurance

    Company Ltd. GIC incorporated as a company.

    2.2) Insurance Sector Reforms

    In 1993, Malhotra Committee headed by former Finance Secretary and RBI

    Governor R.N. Malhotra was formed to evaluate the Indian insurance industry

    and recommend its future direction.

    The Malhotra committee was set up with the objective of complementing the

    reforms initiated in the financial sector. The reforms were aimed at "creating a

    more efficient and competitive financial system suitable for the requirements ofthe economy keeping in mind the structural changes currently underway and

    recognizing that insurance is an important part of the overall financial system

    where it was necessary to address the need for similar reforms"

    In 1994, the committee submitted the report and some of the key

    recommendations included:

    1) Structure

    y Government stake in the insurance Companies to be brought down to50%.

    y Government should take over the holdings of GIC and its subsidiaries sothat these subsidiaries can act as independent corporations.

    y All the insurance companies should be given greater freedom tooperate.

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    2) Competition

    y Private Companies with a minimum paid up capital of Rs.1bn should beallowed to enter the industry.

    y No Company should deal in both Life and General Insurance through asingle entity.

    y Foreign companies may be allowed to enter the industry in collaborationwith the domestic companies.

    y Postal Life Insurance should be allowed to operate in the rural market.y Only One State Level Life Insurance Company should be allowed to

    operate in each state.

    3) Regulatory Body

    y The Insurance Act should be changed.y An Insurance Regulatory body should be set up.y Controller of Insurance (Currently a part from the Finance Ministry)

    should be made independent.

    4) Investments

    yMandatory Investments ofLICLife Fund in government securities to bereduced from 75% to 50%.

    y GIC and its subsidiaries are not to hold more than 5% in any company(There current holdings to be brought down to this level over a period of

    time).

    5) Customer Service

    y LIC should pay interest on delays in payments beyond 30 days.y Insurance companies must be encouraged to set up unit linked pension

    plans.

    y Computerization of operations and updating of technology to be carriedout in the insurance industry The committee emphasized that in order

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    to improve the customer services and increase the coverage of the

    insurance industry should be opened up to competition.

    But at the same time, the committee felt the need to exercise caution as any

    failure on the part of new players could ruin the public confidence in the industry.

    Hence, it was decided to allow competition in a limited way by stipulating the

    minimum capital requirement of Rs.100 crores. The committee felt the need to

    provide greater autonomy to insurance companies in order to improve their

    performance and enable them to act as independent companies with economic

    motives. For this purpose, it had proposed setting up an independent regulatory

    body.

    2.3) MAJOR POLICY CHANGES

    Insurance sector has been opened up for competition from Indian private

    insurance companies with the enactment of Insurance Regulatory and

    Development Authority Act, 1999 (IRDA Act). As per the provisions of IRDA Act,

    1999, Insurance Regulatory and Development Authority (IRDA) was established

    on 19th April 2000 to protect the interests of holder of insurance policy and to

    regulate, promote and ensure orderly growth of the insurance industry. IRDA Act

    1999 paved the way for the entry of private players into the insurance market

    which was hitherto the exclusive privilege of public sector insurance companies/

    corporations. Under the new dispensation Indian insurance companies in private

    sector were permitted to operate in India with the following conditions:

    y Company is formed and registered under the Companies Act, 1956;y The aggregate holdings of equity shares by a foreign company, either by

    itself or through its subsidiary companies or its nominees, do not exceed

    26%, paid up equity capital of such Indian insurance company;

    y The company's sole purpose is to carry on life insurance business or generalinsurance business or reinsurance business.

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    y The minimum paid up equity capital for life or general insurance business isRs.100 crores.

    y The minimum paid up equity capital for carrying on reinsurance businesshas been prescribed as Rs.200 crores.

    The Authority has notified 27 Regulations on various issues which include

    Registration of Insurers, Regulation on insurance agents, Solvency Margin, Re-

    insurance, Obligation of Insurers to Rural and Social sector, Investment and

    Accounting Procedure, Protection of policy holders' interest etc. Applications

    were invited by the Authority with effect from 15th August, 2000 for issue of the

    Certificate of Registration to both life and non-life insurers. The Authority has itsHead Quarter at Hyderabad.

    2.4) Insurance Companies

    IRDA has so far granted registration to 12 private life insurance companies and 9

    general insurance companies. If the existing public sector insurance companies

    are included, there are currently 13 insurance companies in the life side and 13

    companies operating in general insurance business. General Insurance

    Corporation has been approved as the "Indian reinsurer" for underwriting only

    reinsurance business. Particulars of the life insurance companies and general

    insurance companies including their web address are given below:

    LIFE INSURERS Websites

    Public Sector

    Life Insurance Corporation of India www.licindia.comPrivate Sector

    Allianz Bajaj Life Insurance Company

    Limited

    www.allianzbajaj.co.in

    Birla Sun-Life Insurance Company Limited www.birlasunlife.com

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    HDFC Standard Life Insurance Co. Limited www.hdfcinsurance.com

    ICICI Prudential Life Insurance Co. Limited www.iciciprulife.com

    ING Vysya Life Insurance Company Limited www.ingvysayalife.comMax New York Life Insurance Co. Limited www.maxnewyorklife.com

    MetLife Insurance Company Limited www.metlife.com

    Om Kotak Mahindra Life Insurance Co. Ltd. www.omkotakmahnidra.com

    SBI Life Insurance Company Limited www.sbilife.co.in

    TATA AIG Life Insurance Company Limited www.tata-aig.com

    AMP Sanmar Assurance Company Limited www.ampsanmar.com

    Dabur CGU Life Insurance Co. Pvt. Limited www.avivaindia.com

    GENERAL INSURERS

    Public Sector

    National Insurance Company Limited www.nationalinsuranceindia.com

    New India Assurance Company Limited www.niacl.com

    Oriental Insurance Company Limited www.orientalinsurance.nic.in

    United India Insurance Company Limited www.uiic.co.in

    Private Sector

    Bajaj Allianz General Insurance Co. Limited www.bajajallianz.co.in

    ICICI Lombard General Insurance Co. Ltd. www.icicilombard.com

    IFFCO-Tokio General Insurance Co. Ltd. www.itgi.co.in

    Reliance General Insurance Co. Limited www.ril.com

    Royal Sundaram Alliance Insurance Co. Ltd. www.royalsun.com

    TATA AIG General Insurance Co. Limited www.tata-aig.com

    Cholamandalam General Insurance Co. Ltd. www.cholainsurance.com

    Export Credit Guarantee Corporation www.ecgcindia.comHDFC Chubb General Insurance Co. Ltd.

    REINSURER

    General Insurance Corporation of India www.gicindia.com

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    2.5) Protection of the Interest of Policy Holders

    IRDA has the responsibility of protecting the interest of insurance policyholders.

    Towards achieving this objective, the Authority has taken the following steps:

    y IRDA has notified Protection of Policyholders Interest Regulations 2001 toprovide for: policy proposal documents in easily understandable language;

    claims procedure in both life and non-life; setting up of grievance redressal

    machinery; speedy settlement of claims; and policyholders' servicing. The

    Regulation also provides for payment of interest by insurers for the delay in

    settlement of claim.

    y The insurers are required to maintain solvency margins so that they are in aposition to meet their obligations towards policyholders with regard to

    payment of claims.

    y It is obligatory on the part of the insurance companies to disclose clearlythe benefits, terms and conditions under the policy. The advertisements

    issued by the insurers should not mislead the insuring public.

    y All insurers are required to set up proper grievance redress machinery intheir head office and at their other offices.

    The Authority takes up with the insurers any complaint received from the

    policyholders in connection with services provided by them under the insurance

    contract.

    Porters Five Force Analysis

    1.Threat of New Entrants. The average entrepreneur can't come along andstart a large insurance company. The threat of new entrants lies within the

    insurance industry itself. Some companies have carved out niche areas in

    which they underwrite insurance. These insurance companies are fearful of

    being squeezed out by the big players. Another threat for many insurance

    companies is other financial services companies entering the market. What

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    would it take for a bank or investment bank to start offering insurance

    products? In some countries, only regulations that prevent banks and other

    financial firms from entering the industry. If those barriers were everbroken down, like they were in the U.S. with the Gramm-Leach-Bliley Act of

    1999, you can be sure that the floodgates will open.

    2.Power of Suppliers. The suppliers of capital might not pose a big threat, butthe threat of suppliers luring away human capital does. If a talented

    insurance underwriter is working for a smaller insurance company (or one

    in a niche industry), there is the chance that person will be enticed away by

    larger companies looking to move into a particular market.

    3.Power of Buyers. The individual doesn't pose much of a threat to theinsurance industry. Large corporate clients have a lot more bargaining

    power with insurance companies. Large corporate clients like airlines and

    pharmaceutical companies pay millions of dollars a year in premiums.

    Insurance companies try extremely hard to get high-margin corporate

    clients.

    4.Availability of Substitutes. This one is pretty straight forward, for there areplenty of substitutes in the insurance industry. Most large insurance

    companies offer similar suites of services. Whether it is auto, home,

    commercial, health or life insurance, chances are there are competitors

    that can offer similar services. In some areas of insurance, however, theavailability of substitutes are few and far between. Companies focusing on

    niche areas usually have a competitive advantage, but this advantage

    depends entirely on the size of the niche and on whether there are any

    barriers preventing other firms from entering.

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    5.Competitive Rivalry. The insurance industry is becoming highlycompetitive. The difference between one insurance company and another

    is usually not that great. As a result, insurance has become more like acommodity - an area in which the insurance company with the low cost

    structure, greater efficiency and better customer service will beat out

    competitors. Insurance companies also use higher investment returns and a

    variety of insurance investment products to try to lure in customers. In the

    long run, we're likely to see more consolidation in the insurance industry.

    Larger companies prefer to take over or merge with other companies

    rather than spend the money to market and advertise to people.

    PEST Analysis

    y Political Factoro Increased service tax on premiumo5% discount on corporate premiumoHike in FDI limitoPricing control in general insuranceoFavorable regulation for rural insurance

    y Economic Factoro Increase in Gross Domestic Savings

    y Social Factor

    o Low insurance coverageoRise in elderly populationoChanging Indian perceptionoGrowth of Islamic Insurance

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    o Increase in Life style diseases

    y Technological FactoroAutomation of processo Increase in CRM solutionso Internet driven information eraoBusiness Process Monitoring

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    Objectives of the Study

    y To do detailed analysis of Insurance Industry in India (BothLife Insurance and General Insurance).

    y To do a Comparative Study of the Selected companies

    y To Study Role of Insurance Sector in Economy.

    y To analyze the future of Insurance Industry in India.

    y To study the policies, regulations, reforms and its impact onInsurance Industry in India.

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    Companies Selected

    For the purpose of the study we as a group have selected four companies each

    from Life Insurance Sector and General (Non-Life) Insurance Sector. We have

    selected these companies on the basis of their market share i.e. top three

    companies in each sector on the basis of their market share.

    The three companies selected in Life Insurance sector include one company from

    public sector and three from private sector. These include:

    1.Life Insurance Corporation of India2.ICICI Prudential Life Insurance Co. Ltd.3.Bajaj Allianz Life Insurance Co. Ltd.

    The four companies selected in General Insurance sector also include one

    company from public sector and three from private sector. These are:

    1.The New India Assurance Co. Ltd.2.ICICI Lombard General Insurance Co. Ltd.3.Reliance General Insurance Co. Ltd.

    Detailed Profiles of the selected companies are given starting from the next page.

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    Life Insurance Corporation

    The story of insurance is probably as old as the story of mankind. The same

    instinct that prompts modern businessmen today to secure themselves against

    loss and disaster existed in primitive men also. They too sought to avert the evil

    consequences of fire and flood and loss of life and were willing to make some sort

    of sacrifice in order to achieve security. Though the concept of insurance is largely

    a development of the recent past, particularly after the industrial era past few

    centuries yet its beginnings date back almost 6000 years.

    Life Insurance in its modern form came to India from England in the year 1818.

    Oriental Life Insurance Company started by Europeans in Calcutta was the first life

    insurance company on Indian Soil. All the insurance companies established during

    that period were brought up with the purpose of looking after the needs of

    European community and Indian natives were not being insured by these

    companies. However, later with the efforts of eminent people like Babu Muttylal

    Seal, the foreign life insurance companies started insuring Indian lives. But Indian

    lives were being treated as sub-standard lives and heavy extra premiums were

    being charged on them. Bombay Mutual Life Assurance Society heralded the birth

    of first Indian life insurance company in the year 1870, and covered Indian lives at

    normal rates. Starting as Indian enterprise with highly patriotic motives, insurance

    companies came into existence to carry the message of insurance and social

    security through insurance to various sectors of society. Bharat Insurance

    Company (1896) was also one of such companies inspired by nationalism.

    The Swadeshi movement of 1905-1907 gave rise to more insurance companies.

    The United India in Madras, National Indian and National Insurance in Calcutta

    and the Co-operative Assurance at Lahore were established in 1906. In 1907,

    Hindustan Co-operative Insurance Company took its birth in one of the rooms of

    the Jorasanko, house of the great poet Rabindranath Tagore, in Calcutta.

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    The Indian Mercantile, General Assurance and Swadeshi Life (later Bombay Life)

    were some of the companies established during the same period. Prior to 1912

    India had no legislation to regulate insurance business. In the year 1912, theLife

    Insurance Companies Act, and the Provident Fund Act were passed. The Life

    Insurance Companies Act, 1912 made it necessary that the premium rate tables

    and periodical valuations of companies should be certified by an actuary. But the

    Act discriminated between foreign and Indian companies on many accounts,

    putting the Indian companies at a disadvantage.

    The first two decades of the twentieth century saw lot of growth in insurance

    business. From 44 companies with total business-in-force as Rs.22.44 crore, itrose to 176 companies with total business-in-force as Rs.298 crore in 1938. During

    the mushrooming of insurance companies many financially unsound concerns

    were also floated which failed miserably.

    The Insurance Act 1938 was the first legislation governing not only life insurance

    but also non-life insurance to provide strict state control over insurance business.

    The demand for nationalization of life insurance industry was made repeatedly in

    the past but it gathered momentum in 1944 when a bill to amend the Life

    Insurance Act 1938 was introduced in the Legislative Assembly. However, it was

    much later on the 19th of January, 1956, that life insurance in India was

    nationalized. About 154 Indian insurance companies, 16 non-Indian companies

    and 75 provident were operating in India at the time of nationalization.

    Nationalization was accomplished in two stages; initially the management of the

    companies was taken over by means of an Ordinance, and later, the ownership

    too by means of a comprehensive bill.

    The Parliament of India passed the Life Insurance Corporation Act on the 19th of

    June 1956, and the Life Insurance Corporation of India was created on 1st

    September, 1956, with the objective of spreading life insurance much more

    widely and in particular to the rural areas with a view to reach all insurable

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    persons in the country, providing them adequate financial cover at a reasonable

    cost.

    LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its

    corporate office in the year 1956. Since life insurance contracts are long term

    contracts and during the currency of the policy it requires a variety of services

    need was felt in the later years to expand the operations and place a branch

    office at each district headquarter. re-organization ofLIC took place and large

    numbers of new branch offices were opened. As a result of re-organisation

    servicing functions were transferred to the branches, and branches were made

    accounting units. It worked wonders with the performance of the corporation.

    It may be seen that from about 200.00 crores of New Business in 1957 the

    corporation crossed 1000.00 crores only in the year 1969-70, and it took another

    10 years for LIC to cross 2000.00 crore mark of new business. But with re-

    organisation happening in the early eighties, by 1985-86 LIC had already crossed

    7000.00 crore Sum Assured on new policies.

    Today LIC functions with 2048 fully computerized branch offices, 100 divisional

    offices, 7 zonal offices and the Corporate office. LICs Wide Area Network covers

    100 divisional offices and connects all the branches through a Metro Area

    Network. LIC has tied up with some Banks and Service providers to offer on-line

    premium collection facility in selected cities.

    LICs ECS and ATM premium payment facility is an addition to customer

    convenience. Apart from on-line Kiosks and IVRS, Info Centres have been

    commissioned at Mumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata,

    New Delhi, Pune and many other cities. With a vision of providing easy access to

    its policyholders, LIC has launched its SATELLITE SAMPARK offices. The satellite

    offices are smaller, leaner and closer to the customer. The digitalized records of

    the satellite offices will facilitate anywhere servicing and many other

    conveniences in the future.

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    LIC continues to be the dominant life insurer even in the liberalized scenario of

    Indian insurance and is moving fast on a new growth trajectory surpassing its own

    past records.LIC

    has issued over one crore policies during the current year. It hascrossed the milestone of issuing 1,01,32,955 new policies by 15th Oct, 2005,

    posting a healthy growth rate of 16.67% over the corresponding period of the

    previous year.

    From then to now, LIC has crossed many milestones and has set unprecedented

    performance records in various aspects of life insurance business. The same

    motives which inspired our forefathers to bring insurance into existence in this

    country inspire us atL

    IC

    to take this message of protection to light the lamps ofsecurity in as many homes as possible and to help the people in providing security

    to their families.

    Objectives of LIC:

    y Spread Life Insurance widely and in particular to the rural areas and to thesocially and economically backward classes with a view to reaching all

    insurable persons in the country and providing them adequate financial

    cover against death at a reasonable cost.

    yMaximize mobilization of people's savings by making insurance-linkedsavings adequately attractive.

    y Bear in mind, in the investment of funds, the primary obligation to itspolicyholders, whose money it holds in trust, without losing sight of the

    interest of the community as a whole; the funds to be deployed to the best

    advantage of the investors as well as the community as a whole, keeping inview national priorities and obligations of attractive return.

    y Conduct business with utmost economy and with the full realization thatthe moneys belong to the policyholders.

    y Act as trustees of the insured public in their individual and collectivecapacities.

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    yMeet the various life insurance needs of the community that would arise inthe changing social and economic environment.

    y Involve all people working in the Corporation to the best of their capabilityin furthering the interests of the insured public by providing efficient

    service with courtesy.

    y Promote amongst all agents and employees of the Corporation a sense ofparticipation, pride and job satisfaction through discharge of their duties

    with dedication towards achievement ofCorporate Objective

    Mission

    "Explore and enhance the quality of life of people through financial security by

    providing products and services of aspired attributes with competitive returns,and by rendering resources for economic development."

    Vision

    "A trans-nationally competitive financial conglomerate of significance to societies

    and Pride of India.

    Insurance Plans:

    As individuals it is inherent to differ. Each individuals insurance needs and

    requirements are different from that of the others. LIC Insurance Plans are

    policies that talk to you individually and give you the most suitable options that

    can fit your requirement.

    Children Plans

    Jeevan Anurag Komal Jeevan

    CDA Endowment Vesting at 21 Marriage Endowments

    CDA Endowment Vesting at 18 Education Annuity Plan

    Jeevan Kishore JeevanChaaya

    Child Career Plan Child Future Plan

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    Plans for Handicapped

    Jeevan Aadhar Jeevan Vishwas

    Pension Plans

    Pension Plans are Individual Plans that gaze into your future and foresee financial

    stability during your old age. These policies are most suited for senior citizens and

    those planning a secure future, so that you never give up on the best things in life.

    Jeevan Nidhi Jeevan Akshay VI

    New Jeevan Dhara New Jeevan Suraksha-I

    Unit Plans

    Unit plans are investment plans for those who realise the worth of hard-earnedmoney. These plans help you see your savings yield rich benefits and help you

    save tax even if you don't have consistent income

    Wealth Plus Market Plus

    Profit Plus Money Plus

    Child Fortune Plans Jeevan Sathi

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    Special Plan

    LICs Special Plans are not plans but opportunities that knock on your door once in

    a lifetime. These plans are a perfect blend of insurance, investment and a lifetimeof happiness.

    Jeevan Nischay Golden Jubilee Plan

    Jeevan Nischay New Bima Gold

    Health Plus Special Plan

    Health Protection Plus Bima Nivesh 2005

    Micro Insurance Plan

    Jeevan Madhua

    Jeevan Mangal

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    ICICI Prudential Life Insurance Ltd.

    Introduction

    ICICI Prudential Life Insurance Company Limited was incorporated on July 20,

    2000. The authorized capital of the company is Rs.2300 Million and the paid up

    capital is Rs. 1500 Million. The Company is a joint venture of ICICI (74%) and

    Prudential plc UK (26%).

    The Company was granted Certificate of Registration for carrying out Life

    Insurance business, by the Insurance Regulatory and Development Authority on

    November 24, 2000. It commenced commercial operations on December 19,

    2000, becoming one of the first few private sector players to enter the liberalized

    arena.

    The Company recognizes that the driving force for gaining sustainable competitive

    advantage in this business is superior customer experience and investment

    behind the brand. The Company aims to achieve this by striving to provide world

    class service levels through constant innovation in products, distribution channels

    and technology based delivery. The Company has already taken significant steps

    to achieve this goal.

    Sponsors:

    a.) ICICI LTD:

    ICICI Ltd was established in 1955 by the World Bank, the Government of India and

    the Indian Industry, to promote industrial development of India by providing

    project and corporate finance to Indian industry.

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    Since inception, ICICI has grown from a development bank to a financial

    conglomerate and has become one of the largest public financial institutions in

    India. IC

    IC

    I has financed all major sectors of the economy, covering 6,848companies and 16,851 projects. In the fiscal year 2000-2001, ICICI had disbursed a

    total of Rs 319.65 billion.

    ICICI has now developed a whole range of activities to become a Universal Bank.

    Some of ICICI's spectrum of activities includes:

    * Commercial Banking - ICICI Bank, India's first internet bank.

    * InformationTechnology - ICICI Infotech, transaction processing, softwaredevelopment

    * Investment Banking - ICICI Securities, one of the key players in the Indian

    Capital Markets

    * Mutual Fund - Prudential ICICI AMC, leading private sector mutual fund

    player in India

    * VentureCapital - ICICI Venture, leading private equity investor with focus

    on IT and HealthCare

    * Retail Services - ICICI PFS, Marketing and Distribution of Retail Asset

    Products

    * Distribution - ICICI Capital, Distribution and Servicing of Retail Liability

    Products

    ICICI is listed on the Indian Stock Exchanges and on the New York Stock Exchange

    (NYSE). On September 22, 1999, it became the first Indian company to be listed

    on the NYSE (symbol: IC and IC.D). This has been followed by the listing of ICICI

    Bank on NYSE (symbol: IBN) on March 28, 2000.

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    b.) Prudential plc:

    Prudential plc was founded in 1848. Since then it has grown to become one of thelargest providers of a wide range of savings products for the individual including

    life insurance, pensions, annuities, unit trusts and personal banking. It has a

    presence in over 15 countries, and caters to the financial needs of over 10 million

    customers. It manages assets of over US$ 259 billion (Rupees 11, 39,600 crores

    approx.) as ofDecember 31, 1999. Prudential plc. has had its presence in Asia for

    the past 75 years catering to over 1 million customers across 11 Asian countries.

    Prudential is the largest life insurance company in the United Kingdom (Source :

    S&P's UK Life Financial Digest, 1998). Asia has always been an important region

    for Prudential and it has had a presence in Asia for over 75 years. In fact

    Prudential's first overseas operation was in India, way back in 1923 to establish

    Life and General Branch agencies.

    In the US, Prudential owns Jackson National Life, one of the leading life insurance

    companies. Prudential controls approximately 4% of all the listed shares on the

    second largest stock exchange in the world, the London Stock Exchange, making it

    one of the largest institutional investors in the UK. Prudential is focused on the

    internet generation and is one of the first financial service organisations to use

    the internet on a fully integrated basis.

    In October 1998, Prudential launched a "branchless" bank based on the internet.

    Unusually titled as " egg:|". The bank has in a short span of its existence become a

    leading banking service provider in the UK. Infect in the first six months of its

    existence it garnered over 5 billion (US$ 8 billion) in deposits from over 500,000

    customers.

    Development of superior products and services that offer value for money and

    security while producing superior financial returns, enables Prudential to

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    maximize the value of its shareholder's investment and to establish lasting

    relationships with customers and policy holders.

    ICICI and Prudential came together in 1993 to provide mutual fund products in

    India and today are the largest private sector mutual fund company in India. The

    two companies bring together two of the strongest financial service brands in Asia

    known for their professionalism, excellent quality of service and long term

    commitment to YOU.

    Vision and Mission:

    To be the dominant Life, Health and Pensions player built on trust by world-class

    people and service.

    This they hope to achieve by:

    y Understanding the needs of customers and offering them superior productsand service

    y Leveraging technology to service customers quickly, efficiently andconveniently

    y Developing and implementing superior risk management and investmentstrategies to offer sustainable and stable returns to our policyholders

    y Providing an enabling environment to foster growth and learning for ouremployees

    y And above all, building transparency in all our dealingsThe success of the company will be founded in its unflinching commitment to 5

    core values -- Integrity, Customer First, Boundary less, Ownership and Passion.

    Each of the values describes what the company stands for, the qualities of our

    people and the way we work.

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    We do believe that we are on the threshold of an exciting new opportunity,

    where we can play a significant role in redefining and reshaping the sector. Given

    the quality of our parentage and the commitment of our team, there are no limitsto our growth.

    INSURANCE PLANS

    ICICI Prudential has a wide array ofinsurance plans that have been designed with

    the philosophy that different individuals are bound to have differing insurance

    needs.

    The ideal insurance plan is one that addresses the exact insurance needs of the

    individual that will depend on the age and life stage of the individual apart from a

    host of other factors.

    Life Insurance Plans:

    Under Life insurance plans, ICICI Prudential offers plans under the following major

    need categories:

    y Education Insurance PlansOne of your most important responsibilities as a parent is to ensure that your child gets

    the best possible education that can be provided.

    ICICI Prudential offers a wide portfolio ofeducation insurance plans that are designed

    to provide peace of mind to you, as a parent, that your child's education will be secure.

    These plans ensure that money is made available at the crucial junctures in a child's

    education - Class X, Class XII, graduation and post-graduation - to fund crucial

    commitments for the child's future.

    Importantly, education insurance plans ensure that in the unfortunate event of the

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    death of a parent, the child's education continues unhampered.

    Under the education insurance plans platform, ICICI Prudential brings the following

    products to you.

    Product Name Plan Type

    ICICI Pru SmartKid Assure Unit Linked

    ICICI Pru SmartKid Maxima Unit Linked

    ICICI Pru SmartKid Regular Premium Traditional

    yWealth Creation PlansWealth Creation Plans give the customer the dual benefit of protection along with the

    potentially higher returns of market-linked instruments. The most important benefit

    ofULIPs is the flexibility they give the customer in choosing the premium amount and

    also choosing the underlying fund in which this money is to be invested. Wealth

    creation plans also offer the customer more liquidity options as compared

    to traditional plans. As such, ULIPs are ideal for customers who want the protection of

    a life cover to be allied to the returns of market linked instrument giving them an

    unmatched combination of benefits.

    Under the wealth creation platform, ICICI Prudential brings the following products to

    you.

    Product Name Plan Type

    ICICI Pru LifeStage Wealth Unit Linked

    ICICI Pru ACE Unit Linked

    ICICI Pru Premium Wealth UnitL

    inkedICICI Pru Assure Wealth Unit Linked

    ICICI Pru Life Time Maxima Unit Linked

    ICICI Pru Pinnacle Unit Linked

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    yProtection Plans

    The sole objective of these plans, as their name indicates, is to serve the

    protection needs of the customer and by doing so, safeguard ones family

    from the financial implications of unfortunate circumstances than one

    cannot foresee.

    Under the Protection Plans platform, ICICI Prudential brings to you the

    following products:

    Product Name Plan Type

    Pure Protect Traditional

    LifeGuard Traditional

    SavenProtect Traditional

    CashBak Traditional

    Home Assure Traditional

    Pension & Retirement Solutions:

    The primary objective of a pension plan is to help you provide for your financial

    needs in your post retirement years. You will find a Pension Planning Calculator

    on the site, meant to make your pension plan review as simple as possible. The

    calculator is the first step in your Pension Plan scheme; there are other steps

    towards getting the Indian pension policy you need.

    These are ICICI Prudentials pension plan solutions:

    y ICICI Pru LifeTime Pension Maximay ICICI Pru LifeStage Pension Advantagey ICICI Pru Elite Pension II y ICICI Pru Assure Pension

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    y ICICI Pru Forever Lifey ICICI Pru Immediate Annuity

    Health Product Suite:

    Under Health Product Suite, ICICI Prudential offers plans under the following

    major need categories:

    Hospitalization Plans

    yMediAssureyHospital Care

    Critical Illness Pans

    yCrisis Cover

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    BAJAJ ALLIANZ LIFE INSURANCE

    Bajaj AllianzL

    ife InsuranceC

    oL

    td is a unique joint venture among the globalgiants Allianz Group (AG) and Bajaj Auto. Allianz AG's world ranking establishes it

    among the top insurance companies in the world. Allianz AG is a leading insurance

    conglomerate globally and one of the largest asset managers in the world,

    managing assets worth worldwide with 115 years of financial experience in over

    70 countries. Bajaj is the biggest two and three wheeler manufacturer in the

    world. Bajaj Allianz Life Insurance Company boasts of a nationwide presence with

    876 offices and over 4 million satisfied customers. The various insurance products

    include

    Individuals Plans

    Unit Gain Insurances Term Care Plans

    Lifetime Care Insurance Policy

    Business Insurance Policies Savings And Security Policies For You And Your Family Rural Insurance Plan Healthcare Insurance Financial Insurance Pension Plus Retirement Plans Children's Policies Endowment Plans and many more.

    Group Insurance Schemes

    Insurance For Employee-Employer Groups

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    Insurance For Non-Employer - Employee Groups Employees Deposit Linked Insurance New Group Superannuation Scheme New Group Gratuity Care Scheme

    Special Insurance Policies for NRI's

    Invest gain Endowment Plan Cash gain Money Back Plan Child gain Kids Special Plan Swarna Vishranthi

    Bajaj Allianz India offers convenient premium payment and receipt options. The

    payments can be direct through cheques, DD's or directly from your accounts or

    through credit card. The premiums can also be paid online. The insurance policy

    holders who also have an account with Standard Chartered Bank can avail the

    direct debit mandate facility.

    The Bajaj Allianz

    Life Insurance website offers human life value estimator, child

    education cost calculator, retirement solutions and required pension estimator

    and premium calculator online. The Bajaj Allianz insurance agents will guide you

    about the general life insurance policies best suited to your needs. The insurance

    agent also briefs you about the insurance quote and the terms on the policy

    quotes.

    At Bajaj Allianz Life Insurance, customer delight is the guiding principle. The

    business philosophy is to ensure excellent insurance and investment solutions byoffering customised products, supported by the best technology.

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    Accelerated Growth

    Fiscal Year No. of policies sold New Business in FY

    2001-2002(6 months) 21,37 Rs. 7 cr.

    2002-2003 1,15,965 Rs. 63.3 cr.

    2003-2004 1,86,443 Rs. 180 cr.

    2004-2005 2,88,189 Rs. 857 cr.

    2005-2006 7,81,685 Rs. 2,717 cr.

    2006-2007 20,79,217 Rs. 4,302 cr.

    2007-2008 37,44,742 Rs. 6,674 cr.

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    New India Assurance Company Ltd

    In 1919 The New India Assurance Company Ltd. was first incorporated in Bombay,now known as Mumbai in India, initially as composite company for both life and

    general insurance business. As of 1956 New India Assurance converted to an

    Exclusive General Insurance Company and today we are a leading worldwide

    general insurance brand catering to the communities of 27 countries with a large

    network of offices staffed by committed and enthusiastic workforce that aims to

    please.

    New India Assurance Aruba opened her doors to the local community on July 1st,1963 by initiative of the founder, the late Mr. C.H. Raghunath.

    Currently New India Assurance Aruba is directed by the founders youngest

    daughter, Ms. Joy Raghunath whom together with the entire Team New India

    strives to maintain and improve on the proven reliability and sustainability which

    has been carefully nurtured for almost half a century.

    Our 45 years experience of abundant operations in Aruba now enables us to offer

    you the most reliable Smart Insurance Products available in on the island for yourprivate, and commercial vehicles and properties.

    We offer a humane personal approach toward each customer and situation and

    our Smart TeamTM always strives to offer you the quickest response to help relief

    the understandable stress that may arise in difficult moments of presenting an

    insurance claim. We have conquered and maintain the reputation of solid

    reliability by paying all legitimate claims within reasonable time; at New India

    Assurance Aruba we practice the art of being smart and invite you to do thesame.

    Present position

    Gross Premium (in India) of Rs. 5017.20 crores in the year 2006-2007, as against

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    Rs. 4791.49crores in the year2005-2006. Assets Rs. 27444.57crores as on 31st

    March 2007. Network of Offices-26 Regional Offices, 393 Divisional Offices, 614

    Branches and 34D

    irect Agent Branches. Rank No. 1 in the Indian market.Largest

    Non-Life insurer in Afro-Asia excluding Japan.

    First Indian non-life company to cross Rs. 5000 crores Gross Premium. Global Re-

    insurance facilities. Over-seas presence in countries like Japan, U.K, Middle East,

    Fiji and Australia

    International Presence

    Overseas operations commenced in 1920. Operations in 24 countries in the year

    2004-05. Network of 19 Branches, 12 Agencies, 2 Associate companies and 2

    Subsidiary companies in the year 2004-05. Overseas Premium of Rs. 892.35 crores

    in the year 2004-05, which accounts for more than 80% of total overseas

    premium in India.

    Strengths

    Largest number of Offices - In India and Abroad Trained and technically qualifiedstaff 1068 fully computerized offices across India. "A-" (Excellent) rating by

    A.M.Best & Co (Europe) First domestic company to be rated by an International

    Rating Agency Rating based upon following factors: Superior capital position

    Strong operating performance Strong market position Only company to develop

    significant International operations, long record of successful trading outside

    India.

    Pioneers

    First company to set up an Aviation Insurance Department in 1946.

    First company to handle the Hull Insurance requirements of the Indian Shipping

    Fleet.

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    First company to establish its own Training School.

    First company to introduce the concept of 'Model Office Training'.

    First company to create department in Engineering insurance.

    Pioneer in Satellite insurance.

    Mission

    y To develop general insurance business in the best interest of the community.y To provide financial security to individuals, trade, commerce and all other

    segments of the society by offering insurance products and services of high

    quality at affordable cost

    Values

    y Highest priority to customer needs.y High standards of public conduct.y Transparency in operations.

    Commitment to the Citizens

    yWe will respond to all commercially viable general insurance requirementsof the citizens, including products for weaker sections of the society at

    affordable price within three months from the date on which such a

    requirement is received.

    yWe will ensure issuance of 100% of documents within a period of sevendays.

    yWe will ensure that prospectuses of the various insurance products areprovided to the customers and the extent of coverage is explained for his

    choosing the appropriate product. A written proposal will be obtained from

    the insured wherever necessary and accordingly the policy will be

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    prepared.

    yWe will settle all claims within a time schedule envisaged hereunder:A. Personal line insurance claims within 30 days on completion of allrequirements.

    B. Property claims within 30 days on completion of all requirements.

    C. Liability claims within 30 days on completion of process of law.

    yWe will promote customer education in general insuranceproducts/services by holding workshops in various centers.

    yWe will open a customer service cell in all ROs/DOs in addition to theexisting 'May I Help You' counters.

    yWe will set up proper grievance redressal mechanism in every operatingoffice and will educate the clients about the same including the system of

    grievance redressal thorough ombudsman.

    y On request to the policy issuing office, we will make available to acustomer, the status of his claim and/or claim settlement details within

    seven working days.

    yWe will adhere to the IRDA guidelines in protecting the policyholders'interest.

    Products

    Personal

    yPravasi Bhartiya Bima Yojana PolicyyMediclaim PolicyyPersonal Accident PolicyyOverseas Mediclaim PolicyyHouseholders PolicyyMotor PolicyyMoney InsuranceyRoad Safety InsuranceySuhana Safar Policy

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    yTV/VCR/VCP InsuranceyMobile/Cellular Phone Insurance

    Commercial

    yBankers Indemnity PolicyyShopkeepers PolicyyMarine Cargo PolicyyPlate Glass InsuranceySpecial Contigency PolicyyNeon Sign InsuranceyMulti Peril policy for L.P.G. DealersyFidelity Guarantee Insurance PolicyyMarine Hull PolicyyAviation Insurance

    Industrial

    yFire PolicyyMachinery Breakdown PolicyyBurglary PolicyyElectronics Equipment PolicyyConsequential Loss PolicyyContractors All Risk PolicyyStorage cum Erection PolicyyDelay in Startup PolicyyContractor Plant and Machinery PolicyyMega Package Policies

    Liability

    yProducts Liability Policy

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    yProfessional Indemnity PolicyyDirectors and Officers Liability PolicyyLift (Third Party) InsuranceyEmployers' Liability PolicyyCarrier's Liability InsuranceyLiability Insurance Act PolicyyGolfers Indemnity Insurance

    Social

    yJan Arogya Bima PolicyyRaj Rajeshwari Mahila Kalyan YojanayBhagyashree Child Welfare PolicyyJanata Personal Accident InsuranceyStudent Safety InsuranceyAshrya Bima YojanayRural Insurance

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    ICICI Lombard General Insurance Co. Ltd.

    ICICI Lombard General InsuranceC

    ompanyL

    imited is a 74:26 joint venturebetween ICICI Bank Limited , India's second largest bank with $79 billion in assets

    and Fairfax Financial Holdings Limited, a Canada based $26 billion diversified

    financial services company engaged in general insurance, reinsurance, insurance

    claims management and investment management.

    ICICI Lombard is the largest private sector general insurance company in India

    with a Gross Written Premium (GWP) of Rs. 3345 million for the year ended

    March 31, 2008.

    ICICI Lombard General Insurance has been conferred the 'Customer and Brand

    Loyalty award in the 'Insurance Sector - Non-Life' at the 2nd Loyalty awards, 2009.

    It was awarded the General Insurance Company of the Year at the 11th Asia

    Insurance Industry Awards. The company also won the 'NDTV Profit Business

    Leadership Award 2007' and was adjudged as the most Customer Responsive

    Company in the Insurance category at the Economic Times Avaya GlobalConnect

    Customer Responsiveness Award 2006. It has the Gold Shield for "Excellence in

    Financial Reporting" by the ICAI (Institute ofChartered Accountants of India) for

    the year ended March 31, 2006.

    The company has been assigned a domestic rating of iAAA by ICRA (an associate

    of Moodys Investors Service) for highest claim paying ability and a fundamentally

    strong position.

    The company presently has 5697 employees in 395 branches. In the financial year

    ended March 31, 2009, the company issued over 4 million policies across India

    and serviced over 33 lakh claims. The company has a claim disposal ratio of 97%

    (percentage of claims settled against claims reported) as on March 31, 2008.

    All the insurance plans provided by ICICI Lombard come with very attractive offers

    for the customers. Customers can buy their insurance policies online, thus saving

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    valuable time which can be used for other works. The insurance plans are

    processed very fast and involves minimal paperwork. The business products have

    insurance policies for businesses of all types and sizes to meet every requirementthat the business operator might come across. ICICI Lombard provides insurance

    protection to rural customers by customizing it according to their requirements.

    Other than agricultural protection, the company also provides protection in

    health, motor, weather and other sectors as well.

    All the insurance plans provided by ICICI Lombard come with very attractive offers

    for the customers. Customers can buy their insurance policies online, thus saving

    valuable time which can be used for other works.T

    he insurance plans areprocessed very fast and involves minimal paperwork. The business products have

    insurance policies for businesses of all types and sizes to meet every requirement

    that the business operator might come across. ICICI Lombard provides insurance

    protection to rural customers by customizing it according to their requirements.

    Other than agricultural protection, the company also provides protection in

    health, motor, weather and other sectors as well.

    ICICI Lombard received various recognitions over the years in various sectors,

    both in India and abroad. Some of them are mentioned below:

    y ICICI Lombard was adjudged the most Customer Responsive Company inthe category of insurance at the Economic Times Avaya GlobalConnect

    Customer Responsiveness Award 2006

    y ICICI Lombard was awarded the Best Housing Insurance in the Smart LivingAwards by 360 degrees, a Times of India Group subsidiary, in Nov 2006

    y ICICI Lombard was awarded the Gold Shield for Excellence in FinancialReporting by Institute ofChartered Accountants of India for the year ended

    March 31, 2006

    y ICICI Lombard was rated among the top three General InsuranceCompanies to be awarded the General Insurance Company of the Year at

    the 10th Asia Insurance Industry Awards

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    y ICICLombard was listed amongst the top three in the Insurance Website ofthe Year category at the 9th Asia Insurance Industry Awards in Singapore

    during September, 2005

    Channels

    Channel is the term used for the various approaches a company uses to tap its

    customers. ICICI Lombard uses a multi channel approach to sales, service and

    other allied activities.

    The channels used by ICICI Lombard can be broadly stated as under:

    Retail

    The Retail channel consists of sales executives, sales officers, brokers and agents.

    Online

    ICICI Lombard has developed a web-based system to meet all the pre and post-

    policy transaction . One can get quotes, buy, renew and track their policies online

    through the website.

    Bancassurance

    Bancassurance is the distribution of insurance products through a banks network.

    IC

    IC

    IL

    ombard has a tie-up with various banks. With a team of product managers,sales managers and sales executives, the company has been using this channel to

    sell, cross-sell and upsell its products.

    Buying Insurance Online

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    ICICI Lombard was among the first companies to make their insurance products

    available online in India. ICICI Lombard has web-based systems to meet all pre

    and post-policy transactional needs of its customers. One can compare plans, getquotes, buy, renew and keep a track of their insurance policies online.

    Telecalling

    ICICI Lombard was the first general insurance company in India to start telesales

    operations due to its inherent profitability. However in recent times, public

    outburst against pushy and intrusive telecalling in general has led to a reduction

    in cold calling and the introduction of 'do-not-call' (opt-out) lists similar to the US'Do Not Call Registry'. ICICI Lombard too has the Do Not Call option and respects

    the privacy of their customers.

    ICICI Lombard General Insurance Company Limited is a 74:26 joint venture

    between ICICI Bank Limited and the Canada based $ 26 billion Fairfax Financial

    Holdings Limited. ICICI Bank is India's second largest bank, while Fairfax Financial

    Holdings is a diversified financial corporate engaged in general insurance,

    reinsurance, insurance claims management and investment management.

    Lombard Canada Ltd, a group company of Fairfax Financial Holdings Limited, is

    one ofCanada's oldest property and casualty insurers. ICICI Lombard General

    Insurance Company received regulatory approvals to commence general

    insurance business in August 2001.

    Important features of ICICI LOMBARD

    India 's number one private general insurance company

    First general insurance company in India to be ISO 9001:2000 certified

    Assigned the iAAA rating by ICRA indicating highest claims paying ability

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    Simple and fast documentation

    Lightning fast claims settlement

    Instant online policy issuance

    Comprehensive product line

    Highest security level offered through 128-bit encryption in case of online data

    exchange

    First company to provide digitally signed documents through an online

    interface

    Achieved financial breakeven in first full year of operations

    Achieved underwriting breakeven in second year of operations

    Adjudged as the most Customer Responsive Company in the Insurance categry

    at the Economic Times Avaya GlobalConnect Customer Responsiveness Award

    2006

    Awarded the Best Housing Insurance in the Smart Living Awards by 360

    degrees, a Times of India Group subsidiary, in Nov 2006

    Awarded the Gold Shield for "Excellence in Financial Reporting" by the ICAI

    (Institute ofChartered Accountants of India) for the year ended March 31, 2006

    Among the top three General Insurance Companies to be awarded the

    "General Insurance Company of the Year" at the 10th Asia Insurance Industry

    Awards

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    Adjudged amongst the top three in the Insurance Website of the Year

    category at the 9th Asia Insurance Industry Awards function held in

    Singapore during September, 2005

    ICICI Lombard - Parent's Health Insurance

    ICICI Lombard - Parent's Health Insurance takes care of your family at a time

    when they need you the most.

    ICICI Lombard - Parent's Health Insurance

    You work hard abroad and give the best to your family back home. And, though

    they are far away, they are always in your thoughts. Their health and well being

    is your major concern. That's why ICICI Lombard General Insurance has brought

    you Parents' Health Insurance - a comprehensive insurance policy for your

    loved ones.

    Parents' Health Insurance takes care of your family at a time when they need

    you the most.

    ICICI Lombard - Parent's Health Insurance - Policy Coverage

    Hospitalization expenses includingoRoom chargesoDiagnostic test(s) expensesoDoctor's / surgeon's feeoCost of medicines

    Medical expenses incurred in the event of sudden illness or accident.

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    Covers 30 days prior and 60 days post hospitalization expenses. Expenses on technologically advanced treatment which do not require

    hospitalization.

    Coverage limit for specific ailments / conditions:

    Certain specific ailment(s) / surgery(s)/ procedure(s) are covered up to pre-

    defined limits under this policy (subject to the total sum insured).

    All others ailment(s) / surgery(s)/ procedure(s) are covered up to the sum

    insured under the policy.

    Key Benefits

    Pre-existing illnesses can be covered after the 4th year provided the policyis renewed with us for four consecutive years.

    Reimbursement of return airfare (Rs. 20,000 for Plan 2 and Rs. 10,000 forPlan 1) of the NRI (applicant) in case he is required to visit his dependent

    (insured) who has been hospitalised due to specified medical emergencies

    -Stroke, Heart Attack (MI), Coronary Artery Bypass, Graft Surgery, Kidney

    Failure, End-stage Renal Failure, End-stage Liver Disease and Brain Tumour

    Surgery.

    Nursing care benefit of Rs. 500 per day for a maximum of 3 days, in casethe insured requires nursing care post discharge.

    Cashless claims facility at over 3,500 network hospitals across more than135 cities.

    Every insured is provided a free health check-up post issuance of policy.For anyone above 55 years of age, cashless benefit will be activated as

    soon as the health check-up process is completed.

    Income tax benefits u/s 80 D for your income in India. Parents' Health Policy offers a 2-year cover for your dependents against a

    single premium, with automatic renewal after the first year.

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    The policy can be renewed up to the age of 75 years.

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    Reliance General Insurance Company

    Reliance General InsuranceC

    ompanyL

    imited is one of the leading private generalinsurance companies of India, in the present times. It was amongst the first

    companies to apply for, and obtain, a license for insurance business, after the

    liberalization of the insurance sector, in 2000. The company continued to grow

    with the passing time, widening the scope of its insurance policies. Today, it offers

    over 94 customized insurance products, catering to needs of the corporate, SME

    and individual customers. Reliance General Insurance also boasts of being the first

    insurance company in India to be awarded the ISO 9001:2000 certification across

    all functions, processes, products and locations pan-India. Reliance GeneralInsurance (RGI) is one of the fastest growing private sector general insurance

    companies in India and offers a range of products for the corporate and individual

    customers.

    This has made RGI the first general insurance company in the industry to achieve

    this milestone. The distribution network of Reliance General Insurance Co. Ltd.

    extends 200 branch offices spread across 172 cities in 22 states in India.

    Vision

    To be an insurer of World Standards and the most preferred choice for clientele at

    the domestic and global level.

    Mission

    Our Mission is to keep the customer satisfaction as focal point of all our

    operations, adopt the best international practices in underwriting, claims andcustomer service, be the most innovative in product development, establish

    presence all over India, ensure sustained value addition to all stake holders and to

    uphold Corporate Value & Corporate Governance.

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    Growth and innovation

    Reliance General InsuranceC

    ompanyL

    td has grown over time, to set up as manyas 200 offices, which have spread across 173 cities, in 22 states of India. Such a

    wide distribution channel network, along with 24x7 customer service assistance

    and a full fledged website, has added to its success. At the same time, the

    company continues to launch innovative products, like India's first Over-The-

    Counter health & home insurance policies, to woo potential customers and keep

    the presents ones satisfied and pleased.

    Customer Focus

    The brand philosophy of Reliance General Insurance Company is "Protecting what

    you value". The company aims at helping individuals, corporates as well as SMEs

    protect their dreams and accomplishments; that too through a hassle-free buying

    process. With the concept of online buying, Reliance has made it possible for the

    potential customers to book the policies from within the confines of their

    home/office. At the same time, the insurance company intends to make the

    claims settlement as prompt, transparent and speedy as possible.

    Services

    Reliance General Insurance Company offers a wide range of innovative products

    to the potential customers. Right from health and home insurance to car/motor

    and travel insurance, you can get almost all types of individual policies with

    Reliance, that too at the best premium rates. Apart fro