Internship Report On Efu Insurance Company MBA Finance
To
University of Gujrat
ACKNOWLEDGEMENT
First of all we would like to thank ALLAH Almighty Who gave us the courage, health, and energy to accomplish our research in due time and without Whose help this study which required untiring efforts would have not been possible to complete within the time limits. My thanks to The Manager of Ubl branch Wazirabad. Last but not least, we extend our thanks to Sir Imran Syed {UNIT MANAGER OF EFU LIFE INSURANCECOMPANY IN Wazirabad (UBL)} for moral support and guidance for our topic. So that we may able to do our work within time limits. Thanks
Table of contents 1. 2. 3. 4. 5. 6. 7.
Title page Acknowledgement Table of contents History of insurance Types of insurance companies Start of introduction of my company of internship Vision, 7.1 mission 7.2 values 7.3 integrity 7.4 excellence 7.5 professionalism 8. Banca assurance 9. Management 10. Provincial management 11. History 11.1. Starting of efu 11.2. 1947 Office in to Karachi 12. 1961 father of insurance 1961 Father of insurance 1982 Golden jubilee year 1992 efu life launched 13.
1993 A billion rupee company
14.
Efu house Karachi
15.
Introduction of efu house
16.
Weekly schedule of internship
17.
Detail of work
18.
Baca days
19.
Products of efu
20.
Detail of products
21.
Scanned copy of efu forms
28. Pest analysis.
WHAT INSURANCE IS? A promise of compensation for specific potential future losses in exchange for a periodic payment. Insurance is designed to protect the financial wellbeing of an individual, company or other entity in the case of unexpected loss. Some forms of insurance are required by law, while others are optional. Agreeing to the terms of an insurance policy creates a contract between the insured and the insurer. In exchange for payments from the insured (called premiums), the insurer agrees to pay the policy holder a sum of money upon the occurrence of a specific event. In most cases, the policy holder pays part. Life insurance (or commonly life assurance, especially in the Commonwealth) is a contract between an insured (insurance policy holder) and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money (the "benefits") in exchange for a premium, upon the death of the insured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger payment. The policy holder typically pays a premium, either regularly or as a lump sum. Other expenses (such as funeral expenses) are also sometimes included in the benefits. Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; common examples are claims relating to suicide, fraud, war, riot, and civil commotion. Life-based contracts tend to fall into two major categories:
Protection policies – designed to provide a benefit in the event of specified event, typically a lump sum payment. A common form of this design is term insurance.
Investment policies – where the main objective is to facilitate the growth of capital by regular or single premiums.
Types of Insurance Companies There are many types of insurance companies. It is useful to be aware of the general types, since the differences may have an impact on the types and cost of insurance offered by these entities
Captive insurance company. This is an entity that exists to underwrite the risks of its parent owner. The concept can also be used to provide insurance for a group of participating entities.
Domestic. This is an insurance company that is incorporated in the state within which it is domiciled. This entity is considered a domestic insurer within that specific state, and a foreign insurer within all other states (though it can still be licensed to do business in other states).
Alien. This is an insurance company that is incorporated under the laws of another country. It is considered an alien entity from the perspective of any other country within which it does business.
Lloyds of London.
This is a business underwriting insurance under the authorization of the English Parliament. These entities are more likely to issue coverage for more unusual or high risk items, as well as the usual types of insurance.
Mutual The policy holders own this type of business, so earnings are distributed back as dividends. Losses are not usually charged back to policy holders, based on the terms of their insurance agreements.
Stock company. This is an entity organized as a corporation, with shareholders. Any excess earnings of this type of business may be distributed as dividends to the shareholders. An insurance company may also be classified by the type of insurance services that it offers. As an example, a monocline company issues only a particular type of insurance, while a multiple line company offers several types of insurance. Further, a financial services company can provide not only insurance products, but also other types of financial services.
My internship is on efu insurance company, head office in Karachi .the efu house, main building of efu insurance company.
Vision To continue our journey to be better than the best. Mission To provide services beyond expectation with a will to go an extra mile. In the process, continue to upgrade technology, human resource and reinsurance protection. Values Our philosophy is to be the leading company with service above par, with integrity, excellence and professionalism. Following are our core values: Integrity & Ethics Conduct business with ethics, dignity, fairness and transparency.
Excellence We measure our performance by results but more by quality of service.
Professionalism We believe professionalism is perfection. Business resources are utilized in a manner to achieve optimum returns on resources.
Our people In EFU we work like a family. Everyone is treated with respect and without any discrimination.
Banc assurance:
The bank insurance model (BIM), also sometimes known as banc assurance, is the partnership or relationship between a bank and an insurance company whereby the insurance company uses the bank sales channel in order to sell insurance products, an arrangement in which a bank and an insurance company form a partnership so that the insurance company can sell its products to the bank's client base.
BIM allows the insurance company to maintain smaller direct sales teams as their products are sold through the bank to bank customers by bank staff and employees as well. Bank staff and tellers, rather than an insurance salesperson, become the point of sale and point of contact for the customer. Bank staff are advised and supported by the insurance company through product information, marketing campaigns and sales training.
The bank and the insurance company share the commission. Insurance policies are processed and administered by the insurance company. This partnership arrangement can be profitable for both companies. Banks can earn additional revenue by selling the insurance products, while insurance companies are able to expand their customer base without having to expand their sales forces or pay commissions to insurance agents or brokers. Banc assurance, the sale of insurance and pensions products through a bank, has proved to be an effective distribution channel in a number of countries in Europe, Latin America, and Asia
Management Managing director & Chief Executive
Taher G. Sachak
Distribution Channels Sales Force o Mustafa Husain Ali National Sales Director Group Benefits o S. Ali RazaZaidi Executive Director Banc assurance o Husain Sachak
Head of Banc assurance
The Provincial management hierarchy is as follows,
Group Head Unit Head
Coordinators
B.S.C
B.S.C
B.S.C
1932 "Our Beginning"
In Kolkata (Calcutta) the Eastern Federal Union Insurance Company was established with financial assistance from the Aga Khan and the Nawab of Bhopal. It was registered in Kolkata and operated in undivided India and Burma. Its business was both General and Life Insurance.
EFU INSURANCE COMPANY HISTORY OF EFU In 1932, Mr.Ghulam Mohammad, a far sighted man, established Eastern Federal Union Insurance Company (EFU) with financial assistance from the Aga Khan III and the Nawab of Bhopal. Mr.Abdur Rehman Siddiqui became the founder chairman. The company was originally registered at Calcutta and operated in India (undivided) and Burma. By 1961, EFU had become the flag bearer of Pakistan's insurance industry on the world stage and the largest life company in Afro-Asian countries (excluding Japan) under the leadership of Mr.Roshen Ali Bhimjee. It remained so until 1972 when Life Assurance business in Pakistan was nationalized 1947 "Pakistan Our New Home"
On the birth of Pakistan EFU rapidly established itself as a progressive and innovative insurer. It gave the emerging insurance industry the leadership, the manpower and the drive needed to grow in a situating where at the time three-fourths of insurance was held by foreign companies. EFU was amongst the first of seven companies, which were listed on Karachi Stock Exchange in 1949.
1961 "Father of Insurance"
EFU had become the flag bearer of Pakistan's insurance industry on the world stage and the largest life company in Afro-Asian countries (excluding Japan) under the leadership of (Late) Mr.Roshen Ali Bhimjee. It remained so until 1972 when Life Insurance in Pakistan was nationalized.
1982 "Golden Jubilee Year" EFU celebrated its Golden Jubilee in 1982 - a memorable event in the history of Pakistan's insurance industry. The Company's pioneering role in nation building and in the development of insurance is acknowledged by all. 1992 "EFU Life Launched" The Life industry was opened to the private sector and EFU Life was born in 1992. Mr.Roshen Ali Bhimjee became the Chief Executive Officer and under his leadership EFU Life became the largest private sector life insurance company in Pakistan.
1993 "A Billion Rupee Company" EFU General became a Billion Rupee Company under the leadership of Mr.Saifuddin N. Zoomkawala, Managing Director & Chief Executive, a highly talented
leader with international experience. 1996 "EFU House Lahore" The EFU House designed by the famous architect Mr.Nayyar Ali Dada was built giving a new look to Lahore's historic skyline. 2000 "Pakistan's First Specialized Health Insurer" Pakistan's first specialized health insurance company, Allianz EFU was established as a joint venture with Allianz AG of Germany, the largest insurance company in the world.
2001 "EFU Story - Chronicled" Mr. Wolfram W. Karnowski, a close associate of (Late) Mr. R. A. Bhimjee and the EFU Group for over four decades launched two books: "Roshan Ali Bhimjee Between Tears and Laughter", a biography narrating the eventful life of Pakistan's father of insurance and "The EFU Saga", a historic work documenting the corporate success of EFU and of insurance professionals from Pakistan, Bangladesh, India, Germany and UK. A valuable contribution to Pakistan's insurance history and research. 2002 "EFU House, Karachi" Karachi’s historical landmark, Qamar House was acquired to symbolize EFU Group’s foundations and
from now on will be known as EFU House.
2005 "A Billion Rupee Branches" In 1990, EFU General became a Billion Rupee Company. Only after 15 years two EFU Branches "Central and SITE Divisions" became Billion Rupee branches. That is a historical achievement not only for EFU but also for the insurance industry of the country.
2007 "EFU 75 Years" EFU, the largest insurance group proudly celebrates 75 years of committed excellence as we continue to nurture success, year after year. 2008 "Euromoney Award" EUROMONEY, the authoritative international financial journal has adjudged EFU as the Best Insurer in Pakistan
2009 "Brands of the year Award, hat-trick" & "Brands
ICON of Pakistan" EFU General wins for the third consecutive year "Brands of the Year Award".... and is also honored with "Brands ICON of Pakistan".
Weekly schedule of my internship program:
1st week of internship
2nd week of internship
First week of internship is very beneficial for me as it was the training session of the employees at Wazirabad branch from the entire Wazirabad region. I look over the work of a banca assurance sales consultant in
the branch for meeting her goals or targets achieved. 3rd week of internship
I seek how to catch the walk in customer for selling the
th
4 week of internship
insurance products. Form filling is very important for this job as it is an agreement between a person and an insurance company. The form is
5th week of internship
filled with the customer’s data. . The documentation of the customer is taught me in 5th week. How this data is being
th
6 week of internship
stored. Special software is developed by the efu for the general and total instalments and premium of the customer is being calculated in this software.
1st week First week of my internship is very helpful for me in completing my internship as it was a training session of all the employees. In this session they were given knowledge about their products and about their targets of the months. The customer pitch is given by all the employees for the improvement in the front of their trainer. Trainer give hint for customer pitch and tells how to deal with the customers as all the customers are not of same category. The trainer in the presence of all employees himself presented some kind of dummy pitches.
2nd week In 2nd week I go through for the operational work of a sales representative of efu in the bank. The banca assurance sales consultant sits in near a side of cash counter. As the majority of customers come to the counter for banking dealings. Some know how with the customers is build in that course of times. When a customer is ready to hear the words of sales person she starts telling about the products of insurance. In this week I learned about customer dealings. 3rd week In third week I go for work in the customer area how the customer is being given information about the products and tells the benefits of insurance as it is a risk transfer mechanism. Whole of the week is passed in this dealing learning. 4th week In 4th week of my internship program I learned how to fill the form of contract between efu and the customer. This form contains the customer’s information regarding his name age profession income family history medical history etc. all this information are filled properly in accordance with the information given by the customers. 5th week The documentation of customer’s contract is a very important factor in insurance company. All the documents are arranged in a proper way manual and save in systems of bank. All these are necessary because the company’s auditor check these records.
6th week In last week of my internship I get expert in the software of efu on
which all the information of customers are entered and an illustration is printed out in which all the premium, installments and cash value is written by the system on that software.
Banca days: This is a very beneficial event for the efu and that branch in which it was going to celebrate. In this day the all staff of the branch members are involved in customer pitch and making more business of efu on that day. That day the branch is well decorated and warm welcome to all the customers is made. Parents are given the information about products and future is shown that they can invest for betterment. Products of efu:
1. 2. 3. 4.
Saving plan Education plan Retirement plan Marriage plan
Saving plan
Education plan
It is just a simply saving scheme for all type of customers who wants to make their saving with a risk transferable scheme that may give benefit if something happens to him or her. This plan is of minimum 10 years time period. The age criteria are from 18 to 65 years next birthday. This is for those people who want to secure their children
Retirement plan
Marriage plan
Scanned copy of Efu forms
education if they are not alive due to any reason. They can invest for securing the education of children. In this plan the age criteria is same as in saving plan but the benefit is for continuation benefit for their plan. If the life assured died then the company pays all the remaining installments of his or her plan until plan maturity. Then the cash value is given to the children for education. This is for those persons who wants to secure the future after job and does not want to depend on any one. This plan is open ended plan the minimum time period is 10 years and maturity depends on the customers will. Any time after 10 years it can be matured. The person can make this plan with his life partner as the benefit is that they can get a income benefit of 25 % of their premium amount after every 3 months. If one died then the other can make this plan continue. This plan is for the people who want to transfer the risk of their children marriage expenses from today’s comparison of the expenses after some time. The age criteria is 18 to 65 years next birthday.
Pest Analysis
10. Environmental analysisMacroanalysisPoliticalenvironmentSocialenvironment TechnologicalenvironmentEconomicalenvironmentMicroanaly sisCompetitorCustomerIntermediator
11. Political environment Unfortunately for Pakistan, after the horrifying event of the assassination of Mohatarma Benazir Bhutto, the investment climate has deteriorated, loosing investors' confidence. The event of 27 December, 2007 and the political instability post March 2008, changed the business climate in Pakistan, and gave a major hit to Pakistan economy. Yet, the insurance market grew at a rate of 10%, mainly due to inflation factor.
12. SOCIAL ENVIRONMENT Social Security will likely provide additional retirement benefits to retirees beginning, for most persons, after turning sixty. Advance loans. Firstly, insurance, like banking, promotes savings to individuals. Secondly, insurance promotes investment. The insurance company can easily invest its funds in industry, agriculture and commerce. Thirdly, the insured person can get loans against the security of insurance policy from insurance company or from banks. Fourthly, insurance as we all know protects against dangers to life and property. If a person has got his life absence of sufficient financial funds to enable them to resume operations in the wake of a loss and without insurance, these projects would be reduced to nothing more than white elephants.
13. Technological environment Online bid price system Sms services. Free consultancy The Oracle Ex data Machine V2, made by Sun and Oracle, will replace EFU's legacy system to run their new core insurance application on Oracle technology platform in order to respond better and faster to their business challenges.
14. Economical environment Life insurance companies not
only provide investment expertise to their policy holders but by pooling resources they help diversify investment risk. Life insurance companies can actually play a more important role in generating savings as compared to mutual funds. First, life insurance companies have large trained sales forces that have the ability to reach out to a large number of people. For example EFU Life’s sales force presently numbers more than 2,000 spread across the country through 81 branches. Secondly, in the absence of an effective direct debit mandate system in the country, the sales force of life insurance companies help in the collection of premiums – a very important element for disciplined savings. Thirdly, unlike other investment avenues, people tend to look at life insurance contracts as long term savings vehicles – life insurance policyholders are therefore serious savers rather than speculators.
15. Competitor of efu State life insurance company of Pakistan American life insurance co. pak.ltd Excel insurance company limited Habib insurance company limited IGI insurance limited National insurance company limited(state owned)New Hampshire insurance company limited(foreign branch)New jubilee insurance company limited Pakistan general insurance company limited Picic insurance limited
16. Competitor of efu Premier insurance limited Reliance insurance company limited Saudi pak insurance company limited Security general insurance company limited Shaheen insurance company limited Silver Star insurance company limited Trakker direct insurance limited UBL insurance limited United insurance company of Pakistan limited Universal insurance company limited Adamjee life Insurance Company limited Asia care health and life Insurance Company limited East west life A17. Customer of efu insurance company INDIVIDUAL,MARRIED PEOPLE,FAMILIES,JOB PERSONS.HERE WE CAN SAY THAT LIFE INSURANCE PRODUCT HAS A WIDE RANGE.BECAUSE THERE IS A RISK FACTOR INVOLVE IN THE LIFE OF A HUMEN BEING.
18. Intermediaries of efu THE INTERMEDIARIES. INSURERS. REINSURERS. BROKERS. AGENTS. CONSULTANTS.
4p’s Analysis
20. PRODUCT The company is principally engaged in providing general insurance products and services such as fire and property, marine, aviation and motor insurance. EFU also offers personal accident, workmen's compensation, traveller’s accident, burglary liability, fidelity, money, golfers, credit card and computer crime insurance and life insurance.
21. Type of product Consumer product or business product Logic: It depends on situation if a customer is defaulter in payment of instalment, then he will deliver the policy agreement to other person It will act as business product. If a person utilizes his or her policy by making instalments properly and get the claimed amount at maturity date, it will consumer product.
22. TYPE of consumer product Efu life insurance is an unsought product. Logic: life insurance is a product which a person mostly purchased due to risk factor of life, not due to his desire of heart. An unintentionally purchased product is life insurance product.
23. LEVEL of consumer product CORE OF EFU Core means the main benefit of the product, so Monetary saving is probably the biggest benefit of committing to life insurance early in life.http://www.100stips.com/beauty-tips/the-mainbenefit-of-taking-out-life-insurance-early-on-in-life.Our opinion Core of life insurance does not mean the compensation of loss of life but it is only the lump sum payment to nominee, it can be very beneficial.
24. Augmented product Unit-linked products Critical illness
products Education planning product Inflation protection benefit Pension Plans Islamic Fund Products Insurance plan guide book. Instalment payment date information by Sms.
25. Actual product For individual Bank insurance Group insurance Islamic funds product
26. Our opinion indirect marketing should be promoted. Promotion of Online premium payment services. Low cost life plans should offer. Innovations in life plans should be made to hit the target market. Plan should hit the needs of customers.
27. Pricing Price is determined on the basis of risk factors. For youngster risk involvement is low. For old age and army soldiers Risk involvement is high and premium is also high.
28. Pricing strategy Value based strategy is adopted by Efu insurance company. Our opinion Relationship pricing strategy in our opinion should be adopted. Logic: strong relationships leads toward the motive (serving the humanity) of Efu life insurance.
29. Place or distribution Indirect marketing channel For awareness of life insurance product , brokers , agent and middle man play there vital role. Life insurance product is widely spread via this channel. Source; Wasim abidi Unit manager of efu branch located at university chowk in Bahawalpur. Farhan Tariq Unit manager of efu branch located in ahmedpur east.
30. Our opinion indirect marketing channel electronic media like press, internet and other publication sources should be used. Although there is always a need for publicity to any product. Both channels can also be used.
31. Pricing strategy Value base pricing strategy of value base pricing is adopted by efu .Our opinion Relationship strategy should also be adopted. Logic; Customer relationship is preferable for the company to promote business. Relationships lead towards the motive (serve the humanity)
of efu.
32. Thank You
