INSURANCE
Pritesh Agrawal
Amar Ambani
Vishakha Arya
Swati Balasubramanian
Neha Bhandari
Sayanti Bit
DEFINITION
Insurance is a contract between two
parties - the insurer (the insurance
company) and the insured (the
person or entity seeking the cover) -
wherein the insurer agrees to pay the
insured for financial losses arising out
of any unforeseen events in return for
a regular payment of "premium".
TYPES OF INSURANCE
Life Insurance
Individual
Term Assurance
Endowment Policy
Money Back Policy
Children’s Policy
Unit Linked Policy
Annuity
Joint Life Policy
Riders
Double Sum Assured Policy
Group
Non Life Insurance
Fire
Burglary
All Risk
Plate Glass
Domestic Appliance
Householder’s Package
Health
Film
Motor
Market Players in Non Life
Insurance
Bajaj Allianz General Insurance Co. Ltd.
ICICI Lombard General Insurance Co. Ltd.
HDFC Chubb Co. Ltd.
IFFCO Tokyo General Insurance Co. Ltd.
National Insurance Co. Ltd.
New India Assurance Co. Ltd.
Oriental Insurance Co. Ltd.
Reliance General Insurance Co. Ltd.
Royal Sundaram Alliance Insurance Co. Ltd.
Tata AIG General Insurance Co. Ltd.
United India Insurance Co. Ltd.
Cholamandalan
ECGC
Market Share of General Insurance
New India
HDFC Chubb
0.06 20.35
2.07 Oriental Insurance
27.82
Bajaj Allianz
20.67 National Insurance
7.3 0.06 Cholamandalam
21.67
United India
Others
Premium Underwritten
Premium Underwritten among Private Companies(Rs.Crs)
Bajaj Allianz
Cholamandalam
165.97 6.02 Tata-AIG
170.6 259.12
ICICI-Lombard
8.09 IFFCO-Tokio
189.06
200.31
191.31 Reliance
Royal Sundaram
HDFC Chubb
Market Players in Life Insurance
1. Allianz Bajaj Life Insurance Co. Ltd.
2. AMP Sanmar Assurance Co. Ltd.
3. Birla Sun Life Insurance Co. Ltd.
4. AVIVA Life insurance Co. Ltd.
5. HDFC Standard Life Insurance Co. Ltd.
6. ICICI Prudential Life Insurance Co. Ltd.
7. ING Vyasya Life Insurance Co. Pvt. Ltd.
8. Life Insurance Corporation Of India.
9. Max New York Life Insurance Co. Ltd.
10. Metlife India Insurance Co. Pvt. Ltd.
11. OM Kotak Mahindra Life Insurance Co. Ltd.
12. SBI Life Insurance Co. Ltd.
13. Tata AIG Life Insurance Co. Ltd.
Market Share of Life Insurance
Market shares of private players
1% TATA AIG
OM KOTAK
1% BIRLA SUNLIFE
8% 6% 4% MAX NEW YORK
15% ING VYSYA
HDFC STANDARD
MET LIFE
37% 7%
ALLIANZ BAJAJ
6% 1% 1% ICICI PRUDENTIAL
SBI LIFE
13%
AVIVA
AMP SANMAR
SWOT ANALYSIS
SWOT
Strength
Premium rates are increasing and so are
commissions.
The variety of products is increasing.
Prospects expect more services from their brokers.
Weakness
Insurance companies are often slow to respond to
changing needs.
There is an increasing trend of financial weakness
among the companies.
There are more competitors for agencies to compete
with banks and Internet players.
SWOT
Opportunities
The ability to cross sell financial services is barely being
tapped.
Technology is improving to the point that paperless
transactions are available.
The client's increasing need for an "insurance consultant"
can open new ways to service the client and generate
income.
Threats
The increasing cost and need for insurance might hit a
point where a backlash will occur.
Government regulations on issues like health care, mold
and terrorism can quickly change the direction of
insurance. Increasing expenses and lower profit margins
will hit hard on the smaller agencies and insurance
companies.
Increasing expenses and lower profit margins will hit hard
on the smaller agencies and insurance companies.
RE-INSURANCE
Re-insurance is insurer's insurance.
It helps to provide a better spread of risk in the
international market.
It allows primary insurers to accept risks
beyond their capacity.
GIC itself has been the major re-insurer.
GIC reinsures the amount further with
international companies such as Swissre
(Switzerland), Munichre (Germany), and Royale
(UK).
BANCASSURANCE
The selling of insurance policies
through a bank’s established
distribution channels.
Why are banks getting into insurance.
After the opening of the insurance
sector to private players, RBI has
selectively allowed banks to promote
insurance companies.
GROUP INSURANCE
Group Insurance offers life insurance
protection under group policies to
various groups such as employer-
employee, professionals, co-
operatives, weaker sections of society
etc.
The main features of the schemes are
low premium and simple insurability
conditions.
Present Scenario
The Government of India liberalised the insurance
sector in March 2000 with the passage of the
Insurance Regulatory and Development Authority
(IRDA) Bill.
Under the current guidelines, there is a 26 percent
equity cap for foreign partners in an insurance
company.
Premium rates of most general insurance policies
come under the purview of the government appointed
Tariff Advisory Committee.
Regulatory Issues
Insurance is a federal subject in India.
The primary legislations that deals with insurance
business in India are:
Insurance Act, 1938,
Insurance Regulatory & Development Authority Act,
1999.
The IRDA Bill lays down that the Indian promoter must
dilute the stake in the private insurance firms from 74
per cent to 26 per cent in ten years.
The bill stipulates tough solvency margins
- Rs 500 million for life insurance firms,
- Rs 500 million or a sum equivalent to 20 per
cent of net premium income for general insurance,
- Rs 1 billion for reinsurance business.
Vertical services offered by BPO
units for Insurance Industry
New business acquisition processes
Claims processing
Policy owner services
Transaction and re-insurance accounting
Statutory reporting
Annuities processing
Benefit administration
INSURANCE AND RISK MANAGEMENT
It is a systematic way of protecting the
concern’s resources and income against
losses so that the aims of the business can
be reached without interruption.
Risk management offers a systematic,
structured approach to assessing risk and
implementing controls to prevent or
minimize losses. Today, all businesses are
driven by the need to minimize risk,
particularly financial risks.
REQUIREMENTS FOR AGENTS AND
AGENCIES TO SELL INSURANCE PRODUCTS
Recruitment process
Qualification of the applicant
Composite agents' training
Training of professionals
INSURANCE – THE FUTURE
With the Indian Insurance Industry riding on the wave of
a 10% plus growth rate,
annual revenues exceeding $8bn,
a penetration level of insurance at an abysmal 1.8%,
Both, the general and life insurance businesses, have
created a market for themselves.
Privatisation has opened the barriers — offering new
products or opening new lines of business.
Technology has greatly impacted the insurance agency.
New products
Channel productivity
Improving agency effectiveness
Thank You
