cAreerZ-Commerce - Thursday, April 09, 2009

Insurance matters

Considering the number of disasters that have struck

in the recent past, exploring a career in the insurance
sector may indeed be a wise move. Jayanti Ghose
guides you through the path

Apart from statutory obligations, insurance is a way of

covering the costs arising from disasters of various
kinds. The principle of insurance is that the losses of
the few are borne by the contributions of many. Many
people pay into a common pool, and those who incur losses can draw
money from the pool. Insurance services bring benefits to individuals,
businesses, and society as a whole, and also provide opportunities for
people to find fulfilling careers.

There are two broad streams of insurance –general insurance and life
insurance. Life Insurers transact life insurance business while general
Insurers transact the rest. The Insurance Regulatory and Development
Authority (IRDA) is the regulatory body for the insurance industry in India

Some insurance careers are highly specialised and require relevant

specialised qualifications while others are open to all graduates. Actuaries
help design plans and evaluate the financial risks a company takes when it
sells an insurance policy or offers a pension plan.

Underwriters assess proposals and determine terms and costs of an

insurance policy before deciding whether to insure a customer. The
underwriter may decide to pass on a part of the risk to another insurer. This
is known as reinsurance. Reinsurance is an insurance bought by the
insurers.

Claims staff work with people to settle claims against their policies. They
review the policy details, and obtain evidence before paying a claim. Loss
assessors investigate claims for losses caused by burglaries, thefts, fires
and car accidents, etc. They work out the loss covered by an insurance
policy and report the details and circumstances to the insurer.

Insurance agents work on behalf of insurance companies. They are sales

professionals who collect premiums and meet sales targets on a commission
basis.

Insurance Brokers are independent business people who work for

themselves or for brokerage firms to find the best insurance package for
their clients’ needs.

Risk Managers identify and assess their company’s risk, advising on

insurance and investment strategies
Skills/ traits

Integrity, quantitative ability, written and spoken communication skills and

an interest in people are essential.

Education and training

Those who sell insurance must first receive training to sell policies to
individuals and business firms. The Licentiate, Associateship and Fellowship
examinations by the Insurance Institute of India may be pursued alongside
formal education for professional training in insurance.

The first point for embarking on training to be an actuary is on attaining 18

years of age and having passed 10+2 with at least 85 per cent in Maths or
Statistics. Generally, first class graduates or postgraduates in Mathematics,
Statistics or Econometrics will be in a better position than others to qualify
as actuaries. To qualify as an Actuary, a candidate has to pass all
examinations in the prescribed subjects spread over four groups called
Series -- CT, CA, ST and SA – in all, 15 subjects. In addition, he has to
comply with other criteria such as experience requirement and attendance
at a professionalism course prescribed for the purpose.

Institute of Actuaries of India conducts the training programmes. Indian

Institute of Insurance Surveyors & Loss Assessors is the professional body
for insurance surveyors in India.

MBA, Chartered Accountancy, a law degree, computer science and

engineering and related professional courses can lead to careers in
insurance. Of late, some universities like University of Mumbai has started
offering a three-year BCom degree programme with Banking and Insurance.

Many business schools have started offering MBA with sectoral specialization
in insurance to train managers specifically for the insurance industry. These
are open to all graduates through management entrance tests.

Placements/ prospects

Recruiters of insurance professionals would be reinsurance companies,

insurance and reinsurance brokers, actuarial firms, health insurance firms,
consulting firms, banks and financial institutions, microfinance companies,
information technology companies managing underwriting, claims
processing, etc. Entry-level placements could be as Management trainees,
Executive trainees, Business Analysts, Business Development Manager,
Actuarial Analyst, Insurance analyst, etc depending on type of company.

Graduates and postgraduates eligible to take up actuarial examinations are

typically recruited by actuarial employers and placed as actuarial trainees.

With the de-tariffing of the general insurance industry as on January 1,2007

, insurance companies now have the liberty to charge the premium rates
(for the tariffed risks which were earlier governed by the Tariff Advisory
Committee) according to their risk taking capabilities and their risk
management process for their businesses.
The industry would become increasingly more competitive and would require
professionals to manage the underwriting and actuarial work so as to create
rates which are viable and also stress more on the underwriting process.
Marketing would emerge as the key since the companies would be selling
differentiated products (policies).

Enthusiastic, trained people are eagerly sought for their skills and
knowledge and advance quickly.

Institutions

• Insurance Institute of India

• National Insurance Academy, Pune
• Institute of Insurance & Risk Management, Hyderabad
• Birla Institute of Management Technology, Greater Noida
• ITM Institute of Financial Markets ,Navi Mumbai
• University of Mumbai, Department of Statistics
• Institute of Actuaries of India
(Indicative listing)

(The writer is a renowned career consultant)