Project on Surveyors

8/3/2019 Project on Surveyors

1/40

DECLARATION

I hereby declare that this project report titled

ROLE AND FUNCTION OF SURVEYOR AND LOSS ASSESSOR IN

CURRENT INSURANCE MARKET

Is submitted by me to AMITY SCHOOL OF INSURANCE &

ACTUARIAL SCIENCE (ASIAS), is a Bonafide work undertaken by me

and it is not submitted to any other University or Institute for the award of

any Degree / Diploma / Certificate or published any time before.

.

Signature Signature

(Mr. B.R Singh) (Mr. Amit Kumar Barnwal)

(MENTOR) A2828410007


2/40

Acknowledgement

To begin with, I would like to acknowledge all those who have beensupportive in shaping up this project under their guidance and

inspiration.

I would like to give my special thanks and deep sense of gratitude toB.R.Singh (faculty guide, AMITY INSTITUTE OF INSURANCE ANDACTURIAL SCIENCES), for guiding and encouraging to do well

throughout the training period.

My special thanks also go to O.P. Gupta and shetty sir for giving methe opportunity to get trained in the company like United India

insurance. They all have constant source of knowledge, information,

help and motivation for me through in depth knowledge andreflections.

Mr. Rajesh Verma (faculty of marketing in ASIAS) also helped me inselection of my project and also in preparing of my questionnaire. His

teaching of marketing helped me a lot while preparing this project.

I give my sincere thanks to United India Insurance Company for givingme an opportunity to work with them through this project and givingus a practical view of working of an insurance company. Without theirsupport it was not possible to prepare this project. I would mention thename of Mr. Imteazul haque (Risk engineer), Aditya sir, Amit Sharma

(D.M., noida) under whose supervision I completed my project.

I would like to express my sincere gratitude to M.K.Sinha (RegionalManager) who has shared his vision and knowledge and also was the

constant source of inspiration throughout the project.

I am thankful to all the surveyors who have shared their views with meand also helped me filling the questionnaire.

Amit Kumar Barnwal

A2828410007

MBA- Insurance & Banking


3/40

Table of Contents

1. Faculty guide declaration

2. Industry guide declaration

3. Acknowledgement

4. Executive summary

5. Introduction

6. Review of literature

7. Introduction to the problem

8. Methodology

9. Surveyors & loss assessors

a) Role and functions

b) Results and analysis

c) Recommendations

10. References

11. Appendix

12. Annexure


4/40

EXECUTIVE SUMMARY

Insurance sector is one sector which is expected to undergo a sea changeseeing its huge potential in current times as is also evident from the fact thatthis sector has a penetration of a paltry 5-6%.This sector is touted to generate a whole lot of employment opportunities ascontribute significantly towards the countrys GDP.

It is interesting to see that despite such a vast potential for growth of

employment, revenue and investment penetration of insurance to the GDP isvery low. It is just .7% for general insurance and 2.45% for life insurance.

A study was done to understand the role and functions of surveyors and lossassessors in current insurance market.Also an attempt was made to know what new changes and regulations can be

brought out to help surveyors in performing their work smoothly.The purpose of this report was to study the effectiveness in the working ofsurveyors while settling the claim, and also their suggestions for timelysettlement of genuine claim.

This is a kind of exploratory research through a structured questionnairewhich encompassed questions pertaining to the role and functions ofsurveyors and loss assessors in the current insurance market.Convenience sampling was used.

Conclusions

1. It is very essential that surveyors get adequate support from bothinsured and insurer for timely settlement of genuine claim.

2. It is generally seen that if a policy was wrongly obtained by theinsured and once claim is reported, than insured is reluctant todisclose information at the time of settlement of claim and claim

payment is delayed.


5/40

3. By arranging regular training, seminar and get together withsenior members, the standards of surveyors can be raised & makethem efficient in competitive world.

4.In the current changing scenario, where not only domestic but foreigncompanies are also in market, it is important to upgrade the skills ofsurveyors as they are expected to conduct survey work for these companiesalso.

5. As the companies are getting global, the perspective ofcompanies has become more consumers centric.So the surveyors must be in better position to give best and promptservice in settlement of claim.

Recommendations

1. Once a claim is reported to insurance company, there should be quickintimation of claim to the surveyors so that he can take timely action andhelp timely settlement of genuine claim.

2. Company should have structured meetings and discussions withsurveyors regarding various aspects of settlement of claim especially in a

situation where insurance product is getting complicated.

3. Regular training, seminars and up gradation of surveyors will lead totimely completion of survey work and thus settlement of genuine claim.

4. The surveyor is known as independent person and is meant for socialcause. So the surveyor must by his side make all efforts to understand a case

judiciously and take decision on it.

5. A surveyor has to behave and act like an ambassador for the insurers

when he starts from the insurer end but as he has the duty to see that allgenuine claims should be passed.

6. He must not get partial while making report for companies for settling ofclaim.


6/40

INTRODUCTION

TOPIC: Role & Functions of surveyors and loss assessor in insurancemarket.

Man has always been in search of security and protection from the beginningof civilization. This urge in him lead to concept of insurance.The basis of insurance was sharing of the losses of few amongst many.Insurance provides financial stability and strength to individuals andorganization by the distribution of loss of few among many by building up afund over a period of time.

What is insurance?

The legal definition of insurance is that, it is a contract between theinsurers and insured whereby, in consideration of payment of premium bythe insured the insurer agrees to make good any financial loss the insured

may suffer due to the operation of an insured peril.This contract is governed by Indian contract act, insurance act and thecommon law.

Viewpoint of individual: insurance is a device through which the individualsubstitutes mall certain cost of large uncertain loss emphasizes on transfer ofrisk.

Viewpoint of society: from social point of view, insurance is an economicdevice for reducing and eliminating risk through combining a sufficientnumber of homogeneous exposures into a group to make the losses

predictable for the group as a whole.

Viewpoint of law and economics: Insurance in law and economics is aform of risk management primarily used to hedge against the risk of acontingent loss. Insurance is defined as the equitable transfer of the risk of aloss, from one entity to another, in exchange for a premium.


7/40

An insurer is a company selling the insurance. The insurance rate is a factorused to determine the amount, called premium, to be charged for a certainamount of insurance coverage. To incorporate all the factors and to sum up,the commission on insurance terminology of the American risk has definedinsurance as follows Insurance is the pooling of fortuitous losses bytransfer of such risks to insurers, who agree to indemnify for such losses, to

provide other pecuniary benefits on their occurrence, or to render services

connected with the risk.

Insurance is divided into two parts-

1. General insurance2. Life insurance

Earlier there used to be four insurance companies which were

fully controlled by government but after liberalization it was strongly felt ininsurance arena that only four government companies cant achieve thetarget of securing the life of a huge population of a country like India.

Government allowed private players to enter the insurance market and betterserve the need of consumers by innovating products for the huge untapped

population.

INSURERS IN INDIA

Life insurers:

Life insurance Corporation of India (LIC)

General insurers:

GIC had four subsidiary companies, namely

1. United India insurance company limited2. The oriental insurance company limited3. The new India assurance company limited4. National Insurance company limited

In all there are 23 life insurance companies and 23 general/non-lifeinsurance companies (including GIC which is working as reinsurer) working

presently in the market.


8/40

Strengths/opportunities

Out of government fear that four general and one life insurancecompany would not be able to cater to the need of a huge population,government allowed deregulation of the market to increasecompetition and innovation in the insurance areas from underwriting,marketing, policyholder servicing to record keeping.

Private players came out of traditional product and brought innovationin products. Also designing of tailor made product to suit the need ofeach and every individual.

Aggressive marketing by private players will make consumer awareabout the various products available in the market and to help themchoose product which fulfill their requirements.

Large number of private players in market will intensify competitionthus reduction in premiums amount and better services to theconsumer.

Innovation in distribution and improvements in market penetrationwill follow as public and private players compete to market their

products.

The insurance regulatory authority of India keeps a constant watch onthe activity of insurers and make sure that insurers dont mislead theconsumers also bring effective policy for orderly growth of insurancemarket.

IRDA emphasis on quarterly reporting/monitoring of insurer solvencywill enhance capital adequacy and transparency.


9/40

Domestic companies are entering joint venture with foreign insurancecompanies thus bringing expertise, techniques, and innovation in themarket. Though government has allowed only limited share of foreigncompanies in joint venture but still it will bring good prospect forlocal market.

Weakness/challenges

Premium rates will remain under pressure due to intense competitionon more profitable lines.

As the competition increases companies will incur more cost onmarketing activities and thus reduction in the overall profit of thecompany.

Companies will need to upgrade their technology as the innovationwill only reduce the cost of product but up gradation of technologywill cost huge investment and thus reduction in profit.

Intense competition among players will make them use of falsemarketing information to lure them for their product and in this waycustomers fall for wrong product which they dont need.

There is general lack of transparency as financial and operational datafor insurers are not readily available as none of India insurers aredirectly listed on stock exchanges.

Companies still dependent on traditional way distributing theirproduct i.e. agents which make the process slow and sluggish.

There is a great need of trained insurance professionals and

technicians at all levels in insurance profession without whichsustainable growth in insurance sector cant be achieved.


10/40

ABOUT THE COMPANY

United India Insurance Company

United India insurance company limited was incorporated as acompany on 18th February 1938. Nationalized in 1972 and became awholly owned subsidiary of GIC.

After promulgation of IrDA act, 1999, entire share capital transferredto government of India. Currently united India is the fastest growing

public sector general insurer of India.

United India is the leading general insurance company providing widerange of insurance services to the clients in general insuranceheadquartered at Chennai.

United India was formed by the merger of 22 companies, consequentto nationalization of general of insurance.

FINANCIAL OVERVIEW

Solvency ratio was 2.75 as against IrDA requirement of 1.5. It is oneof the highest in the industry.

ICRA granted iAAA rating for 8th consecutive years indicating highestclaim paying capacity.

United India Insurance continued its spectacular performance for thethird year in succession completing a business of 6376.66 crores in2010-11. This is an increase of 1137.61 crores over 2009-10 at agrowth rate of 21.71%.

It is not only highest in pubic sector, but higher than many of largeprivate players.

Net profit and premium earned


11/40

Years Premium Profit

2005-06 2226 4532006-07 2529 5292007-08 2880 6322008-09 3510 4762009-10 4910 707

2010-11 6376 130This 130 crore profit was made after absorbing 900 crore due to wagerevision, enhanced pension fund and gratuity revision, increasedProvisions for Motor Third Party Pool claims as per the directions of IrDA.

So this way the actual profit comes up to 1130 crore which is actually anincrease in profit and premium from previous years.

United India insurance strength:

Strong balance sheet and revenue reserve.

Market leader in hull insurance.

Pioneers and specialists in oil energy.

Insurer of IOC, Indian railway, BHEL, HINDALCO, NTPC.

Projects like Hyundai, marine, Balco, national roadways & highways

etc.

United India has entered a strategic tie ups with major LIC HFLfinance services limited, Vijaya bank, Dena bank, development credit

bank and several RRBs, and co-operative bank during currentfinancial year for banccasurance services.

Strategic tie ups were also made with the automobile manufacturersM/s.Toyota Kirloskar Motors Pvt. Ltd and M/s.Cheverlot Sales

India Pvt. Ltd. during the year to insure their vehicles as a preferredinsurer.


12/40

Projects under United India Insurance company:

NTPC SIMHADRI

IOCL Mega policy

BHEL comprehensive mega risks policy covering all projects

NTPC VINDHYACHAL STAGE 3

BALCO Korba

ONGC mega policy

ONGC offshore package policy

GVK Road project

GMR road project

Golden Quadrilateral project

GMR Hyderabad international airport

Mumbai international airport ltd

Also in its initiative taking insurance to rural masses with largeimplementation of universal health insurance programme ofgovernment of India .

National livestock insurance.

United India remains committed to serve the rural and socially under privileged and have insured 1,62,99,413 People under BPL and unorganized sector and continues its

leadership.


13/40

Literature Review

ASIA INSURANCE REVIEWNew Delhi, April 10 2011

Ficci: Insurance Industry premium to reach $350-400 billion by 2020

India's insurance industry will outpace economic growth and is likely toreach $350-400 billion in terms of premium income by 2020, making itamong the top three life insurance markets, an industry report revealed.According to a study conducted by Federation of Indian chambers ofcommerce and industry.

Asia Insurance Review

Date: 7/4/2011

Premium penetration of insurance industry rose over decade

In a report prepared by association of Chambers of commerce and industryof India (Assocham) that penetration of the insurance industry, premiumas percentage of the country's gross domestic product (GDP), has increasedfrom 2.3 percent in 2001 to 5.2 percent in 2011.

In addition, there has been a vast increase in the coverage of insurance. The

number of life policies in force has increased nearly 12-fold over the pastdecade and health insurance, nearly 25-fold.

Asia Insurance Review (5th Nov 2010)


14/40

India: General insurance premium to reach US $22 Billion in

next 5 years

Indias apex trade body, The Associated Chambers of Commerceand Industry of India (Assocham), has projected that non lifeinsurance premium will rise to about to Rs. 1 trillion in next 5years driven by demand in rural areas as public awareness of theneed for insurance increases in the countryside.

Business line

30th September 2010

Insurance Sector in India poised for tremendous expansion

Insurance Sector in India is poised for tremendous expansion said ShriPawan Kumar Bansal, the Minister of State for Finance while addressing ameeting of Insurance Australia Group on 21st September 2010 in Sydney.Shri Bansal said the banks also have entered the insurance sector in the formof corporate agencies or under referral arrangements to utilize the extensiveand broad reach of marketing of insurance product specially in rural area.

IRDA has also notified Micro Insurance regulations facilitating insurers totap the potential of rural markets. As per these regulations like Non-Government Organizations (NGO), Micro Finance Institutions (MFI) andSelf Help Groups (SHG) have been recognized as micro insurance agents. Itis envisaged that micro insurance would facilitate penetration of insurance torural and remote areas. He said that Micro Insurance being an integral partof overall insurance system, attempts to offer the target specific insurance

products at a relatively lower cost, for a lower coverage of amount.

Shri Bansal said that in insurance sector though the growth in recent yearshas been significant, India is far behind the world averages and ranks 78th in

terms of insurance density and 54 th in terms of insurance penetration. Theworld averages are US $ 469.6 in terms of insurance density and 8.06% interms of insurance penetration. Against this, insurance density was US$19.70 and insurance penetration was 3.17% in India for the year 2003.However, these two indices have increased following the opening of thissector.

Insurance Regulatory and Development Authority has granted registration to


15/40

37 insurance companies, which include 17 life insurance,19 non-lifeinsurance (including four PSU, one AICL & one ECGC) companies & onere-insurance company. At present seventeen insurance companies areoperating in the general insurance side & 17 insurance companies on the lifeside.

According to Shri Bansal, India offers a stable investment climate as well as

a huge market with a growing middle class. Investor confidence in India is atan all time high today. A.T. Kearney in 'The FDI Confidence Index 2009'has ranked India as the 2nd most attractive investment destination just

behind China whereas 'World Investment Report, 2009' ranked India as the2nd most attractive investment destination among Transnational corporation.

Introduction to problem

The reason behind the study was to measure the role and functions ofsurveyor and loss assessors in the current insurance market and the measures

being taken by Institute of surveyors and loss assessor and IrDA inincreasing their effectiveness in this growing market.

Also an attempt was made to find out the changes that surveyors wants IrDAand institute of surveyors and loss assessor to make in their regulations sothat their job remains challenging specially when foreign companies areentering the domestic market through joint alliance and stressing onemploying foreign surveyors and investigators for claim settlement.

The project was divided into three parts:

A comprehensive definition of surveyors and loss assessors

Role and functions of surveyors & loss assessor

Regulations made by IrDA and

Conclusion

For the purpose of study and making the report on it, a significant number ofsurveyors were contacted and through questionnaire an attempt was made tofind out their role in current insurance market and the problem they facewhile dealing with insured and insurer while settling a claim. Also what allmeasures companies and regulator can take in order to increase theefficiency of surveyors and reduce the attrition rate?


16/40

Methodology

Types of research design:

Stage 1: Exploratory research design

Analysis of secondary data in a qualitative way to exactly define theproblem and hypothesis.

Stage 2: Descriptive research design (conclusive research design)

The survey method comprises of a structured questionnaire given torespondents and designed to elicit specific information about role andfunctions of surveyors and loss assessor in current insurance market.

Information needs:

Literature data from previous researchers in same direction.

Theory behind the research, regulatory requirements, details of their workingand other related processes.

Getting the questionnaire filled by respondents.

Feedback by way of questionnaire and suggestions, if any.


17/40

Data collection from secondary sources:

Online search engines, IrDA website

Articles, research papers, journals, newspapers etc

Data collection from primary sources:

(Primary data by way of questionnaire and suggestions)

Data collection is important once sample is selected. Conveniencesampling and simple random sampling are the methods used to choosethe respondents on whom the survey is being conducted. With data

that is available in hard copy was then converted into electronic form.The survey was based on personal method of survey. Questionnairewas then filled up by respondents; purpose of the survey wasexplained to them.The questionnaires were returned back after filling up on theirconvenience.

Scaling techniques:

The respondents were asked to rank the attributes on a five pointerscale likert scale (in terms of 1-strongly agree, 2- agree, 3-neitheragree nor disagree, 4- disagree, 5- strongly disagree), dichotomousscale (1-yes, 2- no), open ended question were also used.

Questionnaire development and pre-texting:

Questionnaire design is a very effective issue as it is a very importanttool by which information is elicited from the respondent.If questionnaire is not prepared well the project will not give effectiveresult. So the questionnaire should be designed carefully and also wemust get it approved by an expert.The questionnaire was meticulously prepared by identifying thevarious variables. A questionnaire was prepared by me and I also getit approved from the faculty.Questionnaire is attached as annexure 1.


18/40

Sampling techniques:

In the survey conducted, the sampling used was conveniencesampling. Data collection was based on my convenience. As my

project required me to get the questionnaire filled from surveyors, Icontacted them by getting reference of my company where I wasdoing my summer internship.

Excel is used for the purpose of analysis of my results.

Surveyors and loss assessor:As per insurance act, 1938 and insurance (amendment) act,- 1968, undersection 64-UM sub clause 2 reads as under :-

No claim in respect of loss which as occurred in India and acquiring to bepaid or settled in India equal to or exceeding Rs. 20000 in value or anypolicy of insurance, arising or intimated to an insurer at any time after theexpiry of a period of one year from the commencement of theinsurance(amendment) Act 1968, shall unless otherwise directed by thecontroller, be admitted for the payment or settled by the insurer unless heobtained a report, on the loss that has occurred, from a person who holds alicense issued under this section to act as a Surveyor or LossAssessor(hereafter referred to as Approved Surveyor or loss Assessor):

The real purpose and correct

definition of surveyorDuties & responsibilities of surveyor:

Surveyor has to play a very vital role amongst the insurers and the insured.To be more honest right explanation of surveyor is a A professional whois called &/or engaged only when a part of community is in crisis forwhatsoever reason hence the community of surveyor is rendering theirservices to the society at large through the insurers, who are the only


19/40

custodians of public money. The surveyor is working in an atmosphere ofcomplete uncertainty when any perils like riots, flood, earthquake etc.operates. Therefore important duties and responsibilities of surveyor isconsidered as under:

A surveyor has to behave and act like an ambassador for the insurerswhen he starts from the insurers end.

The moment a surveyor reaches to the client &/or insured, he issupposed to behave like a doctor to put an ointment on the wound ofthe patient and give him painkiller so that he(insured) is forced torealize that he has been relieved from the pain and tension and feelsthat he is in safe hands. Only thereafter a doctor (surveyor) will start

proper treatment (assignment). If a surveyor behaves in this manner,he will definitely be able to receive full faith of the insured, to whomhe has assured by way of above behavior that he (insured) has been

put in safe hands. The behavior will also result in rebuilding the imageof surveyor at large.

A surveyor is also supposed to be fully aware of his limitations fromthe viewpoint of the policy terms and conditions so that he will beable to explain his limitations to the insured and satisfy and convincehim about his all queries regarding compensation indemnity of loss.

On return a surveyor is supposed to prepare concise but acomprehensive report for the insurer stating therein all necessarymaterial facts as regards cause of loss, degree of moral hazard and theassessment of loss in terms of money.

Responsibilities of surveyors are not over after the release of report as

he is very much concerned about the problems at the end of theinsurers and as such, he is supposed to extend his fullest co-operationto the insurers for an early disposal of a claim.

Conclusion:

Precisely speaking, surveyors are the true working arms for theinsurers without whom they cannot pick even rupee premium from the

market and he is supposed to act as an asset for the insurers not theliability as well as he must always have the concept in his mind thatwe are at par with the red cross society and also they must behavewith insured in the most humble manner.


20/40

Need of surveyors:

It is the statutory requirement of the insurance amendment act -1968 thatany loss except specified in the schedule vide notification no s.o.1983-allthe cases above Rs 20000/- and above are to be surveyed/assessed by anindependent licensed surveyor.

Procedure of becoming a surveyor:

Sec 64 UM (1) reads as under:

a) No person shall act as a surveyor or loss assessor in respect of generalinsurance business after the expiry of a period of three year from thecommencement of the insurance act, 1968, unless he holds a valid licenseissued to him by the comptroller.

b) Every person who intends to act as an surveyor or loss assessor after theexpiry of a period of three years from the commencement of insurance act

1968, shall make an application to the authority on payment of such fee, notexceeding rupees two hundred and fifty as may be prescribed.

c) Every license issued under this section remains in force for a period offive years from the date of issue thereof, and may be renewed for a period offive years at a time, on payment of such fee, not exceeding rupees twohundred and fifty as may be prescribed.

d) No license to act as a surveyor or loss assessor shall be issued unless:

e) The applicant where he is an individual satisfies the authority that he-

a) Holds a degree of a recognized university in a field of engineering, or

b) Is a fellow or associate member of institute of charted accountant ofIndia or the institute of cost and works accountants of India, or


21/40

c) Holds a diploma in insurance granted or recognized by thegovernment

d) Possesses actuarial qualifications or holds a degree or diploma of anyrecognized university or institute in relation to insurance

e) Doesnt suffer from any disqualifications mentioned in sub-section(4) of section 42.

ii) The applicant, where he is a company or firm, satisfies the authority thatall the requirements (a) as the case may be specified in clause

(b) Non of the directors or partners suffer from an of disqualificationsmentioned in sub section (4) of section 42.

A brief on institute of surveyors and loss assessors:

The institute of surveyors and loss assessor came into existence with headoffice at Mumbai on 3th June 1960. The institute has well establishedsystem of organizing training classes and conducting licentiate and associateexaminations, which is one of the eligible qualifications recognized bygovernment of India, for issue of license of surveyors. Presently institute has15 chapters across the country.

Present activity:

a) The institute functions under the control of an active and duly electedmanaging committee, in accordance with memorandum and articles ofassociation.

b) The institute conducts regular meetings and holds an annual generalmeeting every year where decisions regarding up gradation ofsurveyors profession is taken by the members.

c) Over a period of several years, the institute has developed syllabi andcourse materials for study in several branches of general insurance,including a handbook on how to conduct surveys for different types oflosses.

d) The institute regularly conducts meetings with concerned surveyorsfor improvement in surveyors profession, by organizing regular meetand seminars.


22/40

e) The institute is having its own training centers situated at variousplaces of India.

Objects and code of conduct for the surveyors laid by institute:

The primary objective of surveyor is

To promote honorable practice

To repress malpractices

To settle disputed points of practice To decide all questions of professional usage and courtesy between or

amongst surveyors.

To regulate, control and improve restrictive conditions of the conductof the profession.

To discourage unethical practice and propaganda or misleading andinaccurate claims.

Code of conduct:

The institutes of insurance surveyors and adjusters have evolved a codewhich is under:-

i. A member shall not directly or indirectly either personally or as apartner or member of any firm or company, advertise individually forwork in connection with his profession or as an expert witness.

ii. No member shall directly or indirectly, any gratuity discount or tradecommission in connection his professional work and his charges to hisclients shall be his only remuneration in connection with such work.


23/40

iii. The relationship between a member and his client or clients shall at alltimes be strictly fiduciary and he shall not discuss with any third partythe details of his instruction or of any document without theknowledge of his client.

iv. No member shall accept work in respect of which another member hasreceived instruction unless ha shall first have satisfied himself that hearrangement meets with the approval of the principal concerned.

v. No member shall issue a report over his signature unless the work hasbeen done by himself or his staff.vi. No member shall by commission or in any other way make any

payments for the instruction of work offer any financial or otherinducement to secure instructions.

What the survey report should contain:

A survey report is the final paper that is handed over to insurer by thesurveyor and the merit of survey report would decide the award of claim,necessary action that the insurer may take on the basis of survey report andthe most importantly, a survey report conducted by a surveyor will decidewhether he will be preferred by the insurer next time or not.

So it Is the basic requirement for every surveyor that he conduct the surveywork diligently and any prejudice as he has an obligation towards societyand particularly towards the insured that if the claim is genuine it must getapproved by the insurance company based on the information supplied bysurveyor.

A comprehensive survey report must comprised following documents:

Introduction- It must contain all details of the authorities that have assignedthe job and details of the job, which has been asked to be performed.

Basic information

It contains the insurance policy and Details from the schedule, subject matter of insurance. Sum insured,

date of loss, date of FIR, name of the Person who first notice the loss,estimated loss as claimed by the insured.

Case in brief- A surveyor must explain the case in brief includingtherein.

a) About the insuredb) The premisesc) The occurrences


24/40

d) Sum assured and its adequacye) Any other relevant information observed during survey

Remarks surveyor will mention the details of his visit with date regardingthe place and persons he has inspected/contacted and details of observationsdrawn by him in chronological order.

Special mention- Without giving the details of the place and person heinferences which are of importance in the light of the insurance policy, itsexclusions, conditions and warranties must be highlighted.

Conclusion On the basis of special mention, net outcome should bereduced properly in a concise manner and there should be no ambiguity inconclusion drawn.

The investigator

A new concept has evolved in the insurance market seeing the complexityand nature of claims, accident that now a days insurer and surveyors face.A few years back a surveyor was himself capable of handling all types ofclaim that was reported to them by insurer and his judgment was quitesatisfactory for both insured and insurer.

But as a matter of fact a seasoned surveyor can only be successful in limitedarea of claim settlement but for a claim where loss is caused due to theft,

burglary, fraud, and such other cases an investigator is required.

A common feature of investigation claims:

Though each and every claim has its own merit and requires specificattention for certain points and so is the case with different types of policies.

First of all basic information are to be collected from the insurance companyand should be studied properly to decide the line of action. Line of action

could be of two types:

1. In case of proper information is available on the first hand, then theinvestigation work would be started without contacting the insuredand information should be collected fro concerned persons directly orindirectly. The insured should be contacted at last after ensuring thathe is fixed in such a position that any material information/documentcould not be altered or damaged.


25/40

2. In case where first hand information is not available or not sufficientthen insured could be contacted without him having the feel of thegravity of the matter.

The questionnaire given to the insured should be designed in such a mannerthat all important information are in hand and insured is fixed.

Investigation procedure adopted:The investigation procedure adopted must be jotted down step by step by theinvestigator and also from his side he must try to put all the requiredinformation which he came to know at the time of doing investigation andwhich could help insurer in settling the claim.

Investigation and remarksInvestigator must mention the detail of his visit with date regarding the placeand persons he has inspected/contacted and details of outcome/observations/inferences drawn by him in chronological order.

Special care should be taken that circumstantial evidences

alone should not be the basis of the conclusion, because at the

present, only circumstantial evidences are insufficient in the

eyes of law to decide the case against the insured.


26/40

RESULTS AND ANALYSIS

On the basic of information which was obtained from the respondentthrough questionnaire, the results were prepared.

1. Your specialization in doing survey & loss assessinga) Motor

b) Firec) Car/ear

d) Others

Motor 65%

Fire 13%

Car/ear 17%

Others 5%


27/40

0

10

20

30

40

50

60

70

motor fire car/ear others

motor

fire

car/ear

others

It was found that a surveyor has specialization in so many departments. Likein this result almost every surveyor does survey work for motor and also hehas some other specialization.

2. What is your main role as surveyor?

a) Pre acceptance of riskb) Valuation of assets to be insuredc) Loss assessmentd) All of the above

Valuation of assets 14%

Loss assessment 61%

All of the above 4%


28/40

0

10

20

30

40

50

60

70

pre

acceptance

loss

assessment

pre acceptance

valuation of assets

loss assessment

all of above

Most of the surveyors are involved in doing loss assessmentwork. Also companies keep with itself surveyors who survey

the properties brought by people to get insured especially motorvehicles.

3. How long have you been survey and loss assessing profession?

a) Less than 6 month

b) More than 6 month but less than a yearc) Between 5 years (less than 5 years)d) More than 5 years

< than 6 months 4%

More than 6 month butless than a year

17%

Between 5 year 63%

More than 5 years 16%


29/40

4. How frequently you receive a proposal for doing survey and lossassessing for companies?

a. Dailyb. 1-3 daysc. 3-7 daysd. More than 7 days

Daily 18%

1-3 days 43%

3-7 days 27%

More than 7 days 12%


30/40

Result - Pre inspection surveyors get daily proposal as almost daily they gotto survey of vehicles which come for taking insurance policy or for renewal

purpose. Companies ask for survey report of such vehicles and it isimmediately done at the premises of company by a surveyor employed by

insurer.But surveyors who do car/ear or fire policy get survey work in more than 7days because such claims doesnt come on daily basis.

5. Is there any time limit to complete the survey & report submitting

a) Within a fortnightb) Within a monthc) Within 6 monthd) No time limit

Result Although there is a time boundation on surveyors to complete thesurvey work as soon as possible, sometimes it gets delayed due to different


31/40

circumstances like not enough support from insured, or difficulty inassessing the loss.I such a situation surveyor is expected to complete the survey work as soonas possible and submit the report along with the reason of delayed sonecessary action cab be taken by the insurer.

6. If case of any delay in submission of survey report, what is the mostrecurrent reason for the same?

a) Not enough cooperation from insuredb) Excess workloadc) Complexity of workd) Others

Not enoughcooperation

57

Excessworkload

23

Complexityof work

7

others 13


32/40

Result as it is clear from the table that the foremost reason for delay inproject was due to non cooperation of insured.The reason behind that is that if a insured has obtained a policy by givingwrong information i.e. in case of medic claim policy people generally hideabout their critical illness or age or previous policy details and once a claimis lodged they avoid too many questions of surveyor in hope to get the claimamount and in this way survey is delayed.

Another reason could be excess workload. A surveyor who has goodreputation in market gets proposal frequently and by accepting all he delaysthe work.

7. Is there any prescribed format for preparing survey report

a) Yes, all companies and all branches of insuranceb) Yes, all companies but selected branches of insurancec) Yes, some companies and selected branches of insuranced) No

Result IRDA has prescribed a format for preparing the survey report andsurveyors are supposed to follow that.


33/40

But surveyors use their own conviction for preparing the report which isgenerally preferred by the insurance companies.

All branches of insurance i.e. fire, motor, car/ear, marine has some standardmethod of preparing the survey report but surveyors do it in their own way.

8. If yes it is prescribed by

a) IrDAb) Insurance companiesc) Own convictiond) Dont know


34/40

0

10

20

30

40

50

60

irda own

conviction

irda

companies

own conviction

dont know

Results : As the standard format of survey report is prescribed by irda,insurance companies especially private companies give the format which ismore suitable and easily understandable manner.Pre inspection motor surveyors who are employed by insurers for doingsurvey work within companies premises of vehicles that come for motot

policy are given format by insurance company and they do their survey work

according to that.

9. Do you think public sector companies are better than privatecompanies(in terms of quality of service)?

a) Yes they are better than private companiesb) No they are equalc) No they are worse than private companiesd) Cant say


35/40

0%

20%

40%

60%

80%

100%

120% can't say

private companiesbetter than publiccomp

equal

public companies

better thanprivate companies

Public companies are betterthan private companies

57

No they are equal7%

private companies are betterthan public companies 34

Cant say 2%

Results: Most of the surveyors feel that public companies are better thanprivate companies as they have government control over their function.Unlike private companies, there motive is not to make huge profit but to

promote the social cause of securing people.

On the other hand private companies lure customers by attractive offers but

when it comes to payment of claim they are the one who delay the most.

8. Do you think amendments/updations are required in regulationsmade by the IrDA?

A) Yes once a yearB) Yes once in a five years


36/40

C) NoD) Cant say

Yes once in a year 77

Yes once in a five years 15

No 5

Cant say 3

Results - Most of the surveyors feel that there should be amendmentsfrequently in surveyors profession. They say that it was a neglected areawhere no concrete amendments were brought to upgrading the position ofsurveyors in market.But in todays times where surveyors value is recognized as one of theimportant functionaries of insurance market, it is very necessary that someamendment must bring out to make their job more relevant.

Findings

From the study above following findings can be concluded:

a. Surveyors believe that although their profession was neglected formost of the times, now it has been recognized and steps have beentaken by authorities to improve their status.


37/40

b. A surveyor is competent to perform his duty well but due tocircumstances like not enough support of insured or non responsiveattitude of insurer makes the claim delayed and surveyor is blamed forit.

c. Now days foreign companies are entering the domestic market, and

surveyor in such times wants amendments by authority in this regardto upgrade their skills and knowledge so that they dont lose out insuch competitive times.

d. Although a large number of private companies have entered ininsurance sector they are too far from public companies in terms ofservices, claim settlement, grievance taking etc. so they have lot moreto do before they establish a good brand name among people.

e. It was also found from the result that most of the time the delay in

survey work is caused due to complexity of work, so authority shouldarrange training program for surveyors for up gradation of their skills.

Conclusion

Surveyors are the vital link between the insurer and insured and also a majorentity in insurance market and it is impossible to think the proper function of

insurance business without a surveyor.

They also provide useful information to insurance companies with eachsurvey by their feedback and findings which help insurance companies andunderwriters to scrutinize a proposal before accepting it.

It is also in the favor of insurance companies if the role of surveyors arerecognized and improved in the market as it will help and reduce their workload and increase their effectiveness.

References:

In my project, following references have been made:


38/40

Newspapers, journals, research papers and articles-

IrDA journals

Publications of Asia insurance review

Financial express

Business standard

Articles on new role of surveyors in current insurance market.

Insurance times LOMA research papers

Other books- N.K.Malhotra and Satyabhushan dash, marketing research, an appliedorientationP.S.Palande, R.S.Shah, insurance in india, settlement of claim and emerging

opportunities for surveyors

Also various books were provided by companies which were meant for theirown purpose

Internet sources-

www.wikipedia .comwww.gogle.com

www.irda.orgIisla.org (website for surveyors and loss assessors)www.uiic.co.in

QUESTIONNAIRE

ROLE AND FUNCTIONS OF SURVEYOR AND LOSS ASSESSORS IN INSURANCE

MARKET .
http://www.gogle.com/http://www.irda.org/http://www.uiic.co.in/http://www.gogle.com/http://www.irda.org/http://www.uiic.co.in/


39/40

As per the requirement of my summer internship project, I am doing a projecttitled role and functions of surveyors and loss assessors in current insurancemarket therefore please fill this questionnaire as per the requirement.The survey is being done for the sole purpose of education purpose and responses will be

kept confidential.

Name of the respondent:

Age:Email Id:Contact no:Address:

1. Your specialization in doing survey & loss assessinga) Motor b) Firec) Car/Eard) Others

2. What is your main role as a surveyor?a) Pre-acceptance risk inspectionb) Valuation of assets to be insuredc) Loss assessmentd) All of the above

3. How long have been in survey &oss assessing profession?

a) Less than 6 monthb) More than 6 month but less than 1 year

c) Between 5 years (Less than 5 years)d) More than 5 years

4. How frequently you receive a proposal for doing survey & loss assessing for companiesa) Dailyb) 1-3 daysc) 3-7 days (4-7 days)d) More than 7 days

5. Is there any time limit to complete the survey & report submitting (What is the time limit tocomplete the survey & report submitting?)

a) Within a fortnightb) Within a monthc) Within 6 monthsd) No time limit

6. If there is delay in doing survey what is the common reason for it (In case of any delay insubmission of Survey Report, what is the most recurrent reason for the same ?)

a) Not enough support from insured (Not enough cooperation from the indured)b) Excess work loadc) Complexity of work


40/40

d) Others

7. Is there any prescribed format for preparing survey reporta) Yes ,all Companies and all Branches (Fire, Marine, Motor etc) of Insuranceb) Yes ,all Companies but selected Branches (Fire, Marine, Motor etc) of Insurancec) Yes , some Companies and selected Branches (Fire, Marine, Motor etc) of Insuranced) No

8. If yes it is prescribed bya) IRDAb) Insurance Companiesc) Own convictiond) Dont know

9. Do you think that Public Sector Companies are better than private companies (in terms ofquality of service)?

a) Yes, they are better than private companiesb) No, they are equalc) No, they are worse than private companiesd) Cant say

10. Do you think amendments/updations are required in regulations made by the IRDA?a) Yes, once a yearb) Yes, once in 5 yearsc) Nod) Cant say

11. From which company have you taken professional indemnity insurance?a) PSU- NI,OIC, UIIC,NICb) Private Insurance Co- please mention name of the companyc) Not takend) Thinking of taking the same in near future.

Project on Surveyors

Documents

Transcript of Project on Surveyors