SUMMER INTERNSHIP PROJECT

Topic: A Study on car insurance industry in regard to Premier Car World Pvt. Ltd,
Place: Ever Bright Warehouse, Kona, Howrah
Submitted by: Anshu Megotia
Enrollment No:

Under the Guidance of:

Prof. Aniruddha Banerjee Mr. Tanmay Mazumder
(Faculty & Internal Guide) (Operation Manager & External Guide)

In partial fulfilment of award of the degree

Of
MASTER OF BUSINESS ADMINISTRATION

BENGAL INSTITUTE OF BUSINESS STUDIES

18 D Lake View Road
 An Exploratory Research
On
A Study on general insurance industry in regard to Premier Car World Pvt. Ltd.
Submitted to
VIDYASAGAR UNIVERSITY

As Partial Fulfillment of the Requirements for the

Post Graduate Program in Business Management

2016-2018
Under the Guidance of

Prof. Aniruddha Banerjee Mr.

(Faculty & Internal Guide) (Office person)
Submitted by
Anshu Megotia
Bengal Institute of Business Studies, Kolkata (BIBS)
Lake view road, Kolkata, West Bengal
 ACKNOWLEDGEMENT

Apart from my own efforts, the success of any project depends largely on the encouragement and
guidelines of many others. I take this opportunity to express my gratitude to the people who have
been instrumental in the successful completion of this project.

I would thank the entire Management of Premiere Car World Pvt. Ltd. for giving me the
wonderful opportunity to work on internship project in their esteemed organization.

I am highly obliged to Mr. for giving me this project and guiding me throughout my summer
internship research.

I would like to thank my project faculty guide Prof. Aniruddha Banerjee for his constant follow-
up, support, encouragement and guidance to complete this project within the allotted time frame.
And also I would like to thank Prof. Deepak Bhattacharya (Principal of BIBS) and Mr. Vidur
Kapoor (Chairman of BIBS).

I would like to give a special thanks and gratitude to the employees of Premiere Car World Pvt.
Ltd. in extending their support and full co-operation whenever required. Without their support the
project would not have completed.

Last but not the least; I would like to thank my Almighty for blessing me and making this project
a success
 DECLARATION

I, hereby declare that the Summer Internship Project entitled A Study on general insurance

industry in regard to Premier Car World Pvt. Ltd, submitted by me as a partial fulfilment
for the award of Masters of Business Administration to Bengal Institute of Business Studies,
Kolkata is original and genuine work carried out by me.

Date:
Place:

Submitted by:
Anshu Megotia
Bengal Institute of Business Studies
PGPIBM 2016-18 Batch
 TABLE OF CONTENT

Chapter Title Page No

No

Introduction
1

10

11

12
 EXECUTIVE SUMMARY

The Indian general insurance industry, which deals with writing policies from
motorcycles, cars, trucks to health insurance (provides for hospitalisation expenses),
comprises 29 companies and generates an annual premium of Rs 1.25 lakh crore. It is still
dominated by the public sector companies, but the likes of ICICI Lombard, Bajaj Allianz
General Insurance and HDFC Ergo have made strides with advancing market share.
It is ranked 18th among 88 nations. Stars are aligning for the busin ess to get more
profitable now than in the past - be it technology or the changes in regulations, including
the provisions of the Motor Vehicles Act, and the improving data availability with the
information bureau helping to eliminate frauds.

Motor and health, which constitutes 65-70% of the industry, has always been the Achilles
heel for the general insurance industry. It is beset with losses in the third party motor
segment, which is 35% of the industry losses. The good news is that the third party loss
ratios have come down over the last few years.
 INTRODUCTION

Definition
General insurance or non-life insurance policies, including automobile and homeowners
policies, provide payments depending on the loss from a particular financial event. General
insurance is typically defined as any insurance that is not determined to be life insurance. It is
called property and casualty insurance in the United States and Canada and non-life
insurance in Continental Europe.
In the United Kingdom, insurance is broadly divided into three areas: personal lines, commercial
lines]] and London market.
The London market insures large commercial risks such as supermarkets, football players and
other very specific risks. It consists of a number of insurers, reinsurers, P&I Clubs, brokers and
other companies that are typically physically located in the City of London. Lloyd's of London is
a big participant in this market.[1] The London market also participates in personal lines and
commercial lines, domestic and foreign, through reinsurance.
Commercial lines products are usually designed for relatively small legal entities. These would
include workers' compensation (employers liability), public liability, product liability,
commercial fleet and other general insurance products sold in a relatively standard fashion to
many organisations. There are many companies that supply comprehensive commercial
insurance packages for a wide range of different industries, including shops, restaurants and
hotels.
Personal lines products are designed to be sold in large quantities. This would
include autos (private car), homeowners (household), pet insurance, creditor insurance and
others.
ACORD, which is the insurance industry global standards organization, has standards for
personal and commercial lines and has been working with the Australian General Insurers to
develop those XML standards, standard applications for insurance, and certificates of currency.
Types of general insurance
General insurance can be categorised in to following:

Motor Insurance: Motor Insurance can be divided into two group, one is car Four wheeler
insurance and other is two wheeler insurance.
Health Insurance: Common types of health insurance includes, individual health insurance,
family floater health insurance, comprehensive health insurance and critical illness
insurance.
Travel Insurance: Travel insurance can be broadly grouped into Individual travel policy,
Family Travel policy, student travel insurance and senior citizen health insurance.
Home Insurance: Home insurance protects house and its contents in bad time.
Marine Insurance: Marine cargo insurance covers goods, freight, cargo and other interests
against loss or damage during transit by rail, road, sea and/or air.
 Commercial Insurance: Commercial insurance encompasses solutions for all sectors of the
industry arising out of business operations

Current trend
The coming year will assume a significant position in the history of Indian insurance industry.
It denotes completion of a decade of open-market; ending of oligopoly and entry of private
sector insurance companies; and the regime of a new development oriented regulatory
authoritythe IRDA (Insurance Regulatory and Development Authority).

The market continues to attract new capital; barring a handful of mega-risks, there is more than
adequate capacity to cover all the risks within the market. Post de-tariffing, competition for the
existing pie intensified and premium-rates in all classes took a dip. However, insurers are
chasing premium and booking losses and working up unviable combined ratios. It is felt that
the bottom has been reached and an upswing in the rates is inevitable.

At present, the general insurance market has 20+ players already and some more large
international ones are expected to enter shortly. Companies today are coming up with new ideas
to stand out and they are offering the existing and prospective customers, new technology
platforms that would streamline the business and would also be beneficial to them.

The industry is going through a challenging phase now because of the general economic
slowdown and this phase is expected to continue for some time. According to industry experts,
the market will grow by 18% a year and is expected to reach Rs. 900 billion by 2015.

Despite there being over 30 players (in both general and life), the market is still under
penetrated. In the general insurance sector, the penetration level is just about 0.65%. In India,
the urban market is the major contributor for general insurance. Though the rural market does
not have any significant contribution to this sector, it is growing rapidly over the past few years
and is slowly becoming a huge potential market for general insurance in India. To capture the
rural market, companies are adopting strategies to increase awareness levels among the people.
This, they are achieving through increasing the distribution levels and access points. Business
generation through multiple distribution channels is the main agenda for these companies. Some
of them are even adopting the cutting-edge technologies like e-marketing and institutional
marketing for deeper penetration in the rural market.

On the property and liability insurance segmentsniche marketing and competition for small
and medium size companies would be the challenge for the next two years. Project-insurance
sector will continue to be the major work-horse; with continued economic development spurring
investment in power sector, manufacturing and other industries, roads and buildings. Insurers
with right technical support and adequate capacity would be able to benefit from this segment.

Brokers and agentswho upgrade their technical competenceare expected to play an

increased role. Hence, it would be wise for insurance companies to support competent brokers
and agents. These much needed intermediaries with help from insurers and re-insurers would
have to take up a major challenge of educating the under informed customers in risk -
management and risk improvement; accept more reasonable policy deductibles and seek better
policy coverage.

Newer pricing methods need to be developed for commercial lines. Underwriters should give
up the old tariff-based (T-x%) approach and develop experience-based and actuarial-supported
models for pricing. Most of the large risks have already well developed risk-management
departments and deploy ERM (enterprise risk management) techniques; with the right pricing,
and capacity, this segment still offers good pickings. The SME (small and medium enterprise)
sector (property) needs careful cherry-picking and the right marketing approach would yield
dividends.

Catastrophe risk management system has to become robust as the insurance spreads in the semi -
urban and rural areas. With increased penetration, rapid economic development in rural areas,
insurance companies will face losses from events like floods and catastrophes in the interiors
which hitherto have not produced significant insurance losses. It is vital for insurers to monitor
their aggregate exposures closely and buy adequate catastrophe protection. Choices of India-
specific cat-modelling software tools are now available and most of the insurers are using these
tools. With increased awareness in this area, insurers are buying more and more catastrophic
cover; notably the cover being purchased has increased from 100 years to 250 years return
period cover.

Health insurance is a lucrative segment; it is poised to record a massive growth in India in the
coming years. Half of the countrys population is expected to come under the health insurance
umbrella in the next seven years, according to an Ernst & Young study. A mere 12% of the
population is currently covered by healthcare. According to an Economic Times report, the
governments proposal to scale up the foreign direct investment (FDI) in the insurance sector
from 26% to 49% will boost the healthcare business. In the coming years India might witness
more standalone healthcare companies too as they will have an edge in the future market
scenario, says an industry expert.

The recent development in the general insurance sector is the activities by the insurance
regulator. The IRDA has been very stringent and has been keeping a close-watch on the
functioning of all the insurance companies. The latest regulation from IRDA is on health
insurance portability. In the future, general insurance industry will be very much in the limelight
than any other industry facing recession now.

Online selling of insurance policies to discerning customers, who access the Internet will gain
momentum. Typically motor, travel and health policies will be sold more online. Many insurers
have already realised this and are creating separate verticals to exploit this segment. The
interplay of technology & telecom solutions will be a major factor determining the growth of
the industry in the future.

Till recently, micro-insurance on the lines of micro-finance, is thought to be a magic word and
insurers planned to bring retail products to suit this segment. Another area of opportunity is the
government initiatives in health and PA covers for the populace. Rashtriya Swasthya Bima
Yojana (RSBY) schemes and group PA covers sponsored by state and central governments are
providing huge opportunities to insurers. While these schemes provide volumes, pricing and
claims management is critical for success.

The Indian customers are demanding and expect best in class service levels so the entire
insurance industry will have to work towards becoming more customer-centric in the areas of
product development, policy issuance as well as claims settlement. They would need to
constantly do market research to update their products, services & processes to keep up with
the changing needs of their customers.

Completion of 10 years under new regime opens up new opportunities to those private sector
insurance companies which started in 2001. According to law, they will become eligible to raise
capital from public and make IPOs (initial public offerings). Obviously, the promoters would
want to skim the cream; but timing of an IPO is crucial and more importantly, to present the
right financials and a strong-balance sheet is imperative.

The public sector companies will definitely face an extremely competitive situation fro m the
private sectors and the private sectors will in turn have to prove their competency to gain an
edge over the public sectors and to grab a major piece of the market pie. Another major
development in the future would be the number of private insurers in the space. This is expected
to grow as various foreign companies have announced intentions to establish joint ventures.
Given the low level of penetration in some segments, this trend towards foreign participation is
likely to continue for some time. So, India will witness a major competition in the general
insurance market and this definitely indicates a tough but exciting road ahead for the existing
and upcoming players.

One major problem affecting the industry, like in all developing economies is the shortage of
trained insurance professionals and technicians at all levels. So companies that are able to
recruit and grow talent that continue to provide innovative insurance solutions for the
underserved Indian market will be the ones that will rise and shine in the general insurance
industry. The market is large and set for rapid growth but the ones that take the required
calculated risks, have the right technical expertise, do not blindly go after market share and are
customer-centric in their approach to the market will be the ones to benefit from this growth
and become one of the biggest and best run insurance companies in the world.

Benefits of Insurance
Financial Security of Life and Assets in case of an unfortunate event
Tax Relief by way of deductions from Income, which lowers tax burden
Encourages saving and helps in Financial Planning for the Future
Life Insurance Policies can be used as a security to obtain a Loan

Types of General Insurance:

Motor Insurance

Motor insurance covers all damages and liability to a vehicle against various on-road and
off-road emergencies. A comprehensive policy even secures against damage caused by
natural and man-made calamities, including acts of terrorism.
 Motor insurance offers protection to the vehicle owner against:
Damage to the vehicle
It also pays for any third party liability determined by law against the owner of the
vehicle
Motor insurance is mandatory in India as per the Motor Vehicles Act, 1988 and needs to
be renewed every year. Driving a motor vehicle without insurance in a public place is a
punishable offence.
In fact, third party insurance is a statutory requirement in our country i.e. the owner of the
vehicle is legally liable for any injury or damage caused to a third party life or propert y,
by or arising out of the use of the vehicle in a public place.
A comprehensive motor insurance policy would include personal accident and liability only
policy (third party insurance) in addition to own damage cover (damage to owners vehicle)
in one policy.
Common motor insurance categories include:
Car Insurance
Two Wheeler Insurance
Commercial Vehicle Insurance
Some attractive benefits of motor insurance include roadside assistance, cashless servicing
at nation-wide network of workshops and garages, personal accident cover, towing
assistance.
Health Insurance
Health care costs are increasing every year. Sedentary lifestyle and stress at work
negatively affect the health and can result in a critical illness or medical emergency. Such
a scenario is sure to adversely affect one financially, due to the massive outlay of money
on medical expenditure. A health insurance policy is the only way to mitigate the f inancial
risks, apart from leading a healthy lifestyle. Health insurance guarantees peace of mind in
times of crisis, and helps secure own health and that of ones family.
Health insurance covers the medical and surgical expenses of the insured individual due to
hospitalisation from an illness. Additional riders enhance the benefits and scope of the
cover.
Health insurance often includes cashless facility at empanelled hospitals, pre and post
hospitalisation expenses, ambulance charges, daily cash allowance etc.
Common types of health insurance policies include:
Individual Policy
Family Floater Policy
Surgery Cover
Comprehensive Health Insurance
Travel Insurance
 International travel, whether on vacation or business, can turn into a nightmare if one
experiences contingencies like loss of baggage, loss of passport, delay in flight, medical
emergency etc. Such eventualities will surely take the fun away from travelling.
Travel insurance, also referred to as visitor insurance, covers one against unseen medical
and non-medical emergencies during overseas travel, ensuring a worry-free travel
experience. It protects the insured against misfortunes while travelling. Backed up by travel
insurance, the whole experience is like no other.
Different types of travel insurance policies include:
Individual Travel Policy
Family Travel Policy
Student Travel Insurance
Senior Citizens Travel Policy
In addition to the above, some insurance companies offer special plans like a corporate
travel policy or comprehensive policy for travel to special destinations like Asia and/or
Europe.
Home Insurance
Home is often the most treasured possession of an individual and also the largest financial
investments one makes in life. Safeguarding the physical structure and contents of home
seems like a logical thing to do.
Home insurance protects the house and/or the contents in it, depending on the scope of
insurance policy opted for. It secures the home against natural cal amities and man-made
disasters and threats. Home insurance provides protection against risks and damages from
fire, burglary, theft, flood, earthquakes etc. covering the physical asset (building structure)
and valuables (contents) in it.
Home insurance ensures that ones hard-earned savings are utilised to meet important needs
instead of using them for rebuilding the house if some harm was to come to it.
Marine (Cargo) Insurance
Business involves the import and export of goods, within national borders and a cross
international borders. Movement of goods is fraught with risk of mishaps which can result
in damage and/or destruction of shipments. This leads to substantial financial losses for
both the importers as well as the exporters.
Marine cargo insurance covers goods, freight, cargo and other interests against loss or
damage during transit by rail, road, sea and/or air. Shipments are protected from the time
the goods leave the sellers warehouse till they reach the buyers warehouse. Marine cargo
insurance offers complete financial protection during transit of goods and compensates in
the event of any loss suffered.
The party responsible for insuring the goods is determined by the sales contract. Marine
cargo insurance policy can be taken by buyers, sellers, import/export merchants, buying
 agents, contractors, banks etc. The policy usually covers the cargo, but can also be extended
to cover the interest of a third party post transfer of ownership as determined by terms of
sale.
Common types of policies:
Open Cover
Open Policy
Specific Voyage Policy
Annual Policy
The hull of a ship or boat can be insured under marine hull insurance.
Rural Insurance
Insurance solutions to meet the needs of agriculture and rural businesses form part of rural
insurance. IRDA has stipulated annual targets for insurers to provide insurance to the rural
and social sector.
As per these regulations, insurers are required to meet year-wise targets:
In percentage terms of policies underwritten and percentage of total gross premium
income by general insurers under rural obligation
In terms of the number of lives under social obligation
Commercial Insurance
Commercial insurance encompasses solutions for all sectors of the industry arising out of
business operations. Insurance solutions for automotive, aviation, construction, chemicals,
foods and beverages, manufacturing, oil and gas, pharmaceuticals, power, technology,
telecom, textiles, transport and logistics sectors. It covers small and medium scale
enterprises, large corporations as well as multinational companies.
Common types of commercial insurance:
Property Insurance
Marine Insurance
Liability Insurance
Financial Lines Insurance
Engineering Insurance
Energy Insurance
Employee Benefits Insurance
International Insurance Solutions
Other Types of General Insurance:
Property Insurance
Personal Accident
Householder
Shopkeeper
Corporate Insurance
Commercial Insurance
Fire Insurance
 Crop Insurance

Market Potential of General Insurance In India

Government's policy of insuring the uninsured has gradually pushed insurance penetration in the
country and proliferation of insurance schemes are expected to catapult this key ratio beyond 4
per cent mark by the end of this year, reveals the ASSOCHAM latest paper.
The number of lives covered under Health Insurance policies during 2015-16 was 36 crore which
is approximately 30 per cent of India's total population. The number has seen an increase every
subsequent year as 28.80 crore people had the policy in the previous fiscal.
During April 2015 to March 2016 period, the life insurance industry recorded a new premium
income of Rs 1.38 trillion (US$ 20.54 billion), indicating a growth rate of 22.5 per cent. The
general insurance industry recorded a 12 per cent growth in Gross Direct Premium underwritten
in April 2016 at Rs 105.25 billion (US$ 1.55 billion). The life insurance industry reported 9 per
cent increase in overall annual premium equivalent in April-November 2016. In the period,
overall annual premium equivalent (APE)- a measure to normalise policy premium into the
equivalent of regular annual premium- including individual and group business for private
players was up 16 per cent to Rs 1,25,563 crore (US$ 18.76 billion) and Life Insurance
Corporation up 4 per cent to Rs 1,50,456 crore (US$ 22.48).
Indias life insurance sector is the biggest in the world with about 360 million policies which are
expected to increase at a Compound Annual Growth Rate (CAGR) of 12-15 per cent over the
next five years. The insurance industry plans to hike penetration levels to five per cent by 2020.
The countrys insurance market is expected to quadruple in size over the next 10 years from its
current size of US$ 60 billion. During this period, the life insurance market is slated to cross US$
160 billion.
The general insurance business in India is currently at Rs 78,000 crore (US$ 11.44 billion)
premium per annum industry and is growing at a healthy rate of 17 per cent.
The Indian insurance market is a huge business opportunity waiting to be harnessed. India
currently accounts for less than 1.5 per cent of the worlds total insurance premiums and about 2
per cent of the worlds life insurance premiums despite being the second most populous nation.
The country is the fifteenth largest insurance market in the world in terms of premium volume,
and has the potential to grow exponentially in the coming years.

COMPANY PROFILE

Premier Carworld is one of the India's largest Maruti Suzuki dealership launched at the B.T. Road
by Premier Group. This is the first of its kind in India and includes a huge Showroom, state of art
Workshop, facility to buy and sell Pre Owned Cars, and a Motor Driving School..
Premier Carworld Private Limited is a Private incorporated on 09 August 2010. It is classified as
Non-govt company and is registered at Registrar of Companies, Kolkata. Its authorized share
capital is Rs. 50,000,000 and its paid up capital is Rs. 17,200,000.It is inolved in Sale of motor
vehicles [Includes wholesale and retail sale of new and used passenger motor vehicles and
lorries, trailers and semi trailers].

Premier Carworld Private Limited's Annual General Meeting (AGM) was last held on 30
September 2016 and as per records from Ministry of Corporate Affairs (MCA), its balance sheet
was last filed on 31 March 2016.

Directors of Premier Carworld Private Limited are Sarita Agarwal, Ramesh Chandra Agarwal
and Abhishek Agarwal.

Premier Carworld Private Limited's Corporate Identification Number is (CIN)

U50102WB2010PTC152096 and its registration number is 152096.Its Email address is
natwar@premiergroup.in and its registered address is 23 JATIN DAS ROAD KOLKATA WB
700029
Company Details

CIN U50102WB2010PTC152096

Company PREMIER CARWORLD PRIVATE LIMITED

Name

RoC RoC-Kolkata

Registration 152096
Number

Company Company limited by Shares

Category

Company Sub Non-govt company

Category

Class of Private
Company

Date of 09 August 2010

Incorporation

Age of 7 years, 2 month, 8 days

Company

Activity Sale of motor vehicles [Includes wholesale and

retail sale of new and used passenger motor
vehicles and lorries, trailers and semi trailers].
Organisation Structure

Team
Ramesh Agarwal, MD, Premier Carworld

Founder of Premier Group in 1990.

 Made Premier one of the largest distribution house in East.
Worked with blue chip multinational companies including Unilever, Pepsi, Coke,
Reliance, Nokia, LG, Blackberry etc.
Recently entered retail with one of the biggest Maruti Suzuki showroom in India.

Abhishek Agarwal, CEO, Premier Carworld

Holds Undergraduate and Masters degree in Business from US.

Certified Public Accountant from NY State.
Was Manager at Ernst & Young, New York with over five years of experience in
Financial Services.

Somesh Ray, Director, Premier Carworld

Responsible for delivery of excellence across the group companies.

11 yrs exp with Pepsico as Senior Mgr.
Managed Sales & Dist, Mktg, Ops.
7 yrs exp with SC Johnsons as Regional Ops head ($8B US Co).
Done management courses from IIMB, IIMC & XLRI.
Ex Faculty trainer of Pepsico Territory University

a majority stake in Eurostar Express of UAE - first international acquisition by an Indian express
company

Brief History

In the year 2000-2001, Maruti Suzuki analyzed that about 33% of customers total
spending on a vehicle is on Insurance Services including repairs and maintenance. Thus,
with the endeavor to provide best in class Insurance Services to the Maruti customers,
Maruti Insurance was established in the year 2002 and has serviced over 4 Cr customers
till date.

Maruti Insurance Broking Private limited or more commonly known as Maruti Insurance,
is the Insurance arm of the Indian Automobile major Maruti Suzuki India Private
Limited. Maruti Insurance has an alliance with the foremost 11 General Insurance
companies of India, for distribution of Insurance at the most competitive rates exclusively
for the Maruti Suzuki Car owners.

The initiative also makes sure that the customer enjoys additional facilities like seamless
honoring of policy commitments, near cashless transactions, and superior service delivery
across the country.

With over 6 million Happy Customers, Maruti Insurance is the biggest provider of
Insurance Broking Services in India and it focuses on providing complete peace of mind
to its customers.

The Pan-India presence ensures efficient service, across 450+ cities from the highest
mountains of Leh to the least inhabited islands of Andaman, from the barren desert of
Kutch to the green valleys of Imphal.

VISION & MISSION

Mission
Add value to sales, service & distribution.

Vision
To earn the respect of customers & principals by making a real difference to every customer &
principal.

Strength

State of Art facilities

Proven management with experience in many MNCs
Biggest and fastest growing dealer
Sales, Service, Body shop, Pre Owned cars and Motor Driving school in the same
vicinity
 Location advantage

We have

Long term vision.

Ability to think new & do big.
Positive attitude.
Respect for others.
Highly professional & passionate team.
Process & system to train, develop & motivate the team.
Excellence in planning & executing at market place.
Knowledge of market.
Ability to influence.... admin, trade association for right cause.

The reputation & relationship with market

Our Partners Insurance Companies

Objectives/Goals of our company

Our Robust Customer-Centric system and procedures ensure hassle-free Insurance experience for
the customer. We offer the highest level of fairness and transparency in our claim process with
No Hidden Charges.
We guarantee Quality Repairs with no Compromise on the safety & the reliability of the vehicle.
We also ensure that every stage of the repair process from Claim Intimation to final vehicle
delivery adheres to the highest Global Service Standards. We constantly review and upgrade our
processes for delightful Customer Experience.

All claims are settled on near Cash-less basis at 2000+ Maruti Suzuki Dealer Workshops spread
all over the country.

Our deep-rooted Commitment towards our customers ensures their satisfaction level at the
Pinnacle.

Our pledge to Excellence is COMPLETE PEACE OF MIND for every Customer.

Bajaj Allianz Car Insurance

In today's day with a constant increase in the number of cars on the road, it gets very tough to
protect your car from unwanted mishaps. High repair costs, coupled with the cost of spare parts,
can definitely pinch your pockets, which is why it is essential to have a good Car Insurance or a
Package Motor Insurance policy. Bajaj Allianz offers car insurance with a range of covers to
choose from.

With Bajaj Allianz's innovative and all-round insurance plans and easy vehicle insurance
renewals, you get covered with regards to all aspects that an ideal Car Insurance policy should
have. On the basis of the plans you opt for, you secure yourself against road accidents, theft,
among others along with which you can get cashless settlement at network garages and a lot
more! You also get to choose add-on covers of your choice with your Car Insurance policy and
with our 24x7 Roadside Assistance facility, help is just a phone call away.

ICICI Lombard GIC Ltd.

ICICI Lombard GIC Ltd. is a joint venture between ICICI Bank Limited and Fairfax Financial
Holdings Limited, a Canada based diversified financial services company engaged in general
insurance, reinsurance, insurance claims management and investment management. The
company issued over 13.87 million policies and settled over 3.41 million claims as on March 31,
2015.
ICICI Lombard General Insurance Ltd. is one of the largest private sector general insurance
company in India offering insurance coverage for motor, health, travel, home, student travel and
more. Policies can be purchased and renewed online as well. Immediate issuance of policy copy
online.

SBI General

SBI General's current geographical coverage extends to 56 cities pan India and presence in
another 350+ locations through satellite resources. SBI General follows a robust multi-
distribution model encompassing Bancassurance, Agency, Broking & Retail Direct Channels.
Today, Our Distribution family includes over 11,000 IRDA certified SBI & its Associate Bank
employees and over 4,800 Agents.We cover Motor, Health, Travel, Personal Accident & Home
Insurance for Individuals and Aviation, Fire, Marine, Package, Construction & Engineering,
Liability, Group Health, Group Personal Accident & Miscellaneous Insurance for
Businesses.Our dedicated and experienced claims team aim to deliver you a differentiated
customer service of a fast, fair, convenient and transparent claims process for the management
and settlement of your claim.

United India Insurance Company

United India Insurance Company Limited was incorporated as a Company on 18th February 1938.
General Insurance Business in India was nationalized in 1972. 12 Indian Insurance Companies, 4
Cooperative Insurance Societies and Indian operations of 5 Foreign Insurers, besides General Insurance
operations of southern region of Life Insurance Corporation of India were merged with United India
Insurance Company Limited. After Nationalization United India has grown by leaps and bounds and has
18300 work force spread across 1340 offices providing insurance cover to more than 1 Crore policy
holders. The Company has variety of insurance products to provide insurance cover from bullock carts to
satellites.
United India has been in the forefront of designing and implementing complex covers to large customers,
as in cases of ONGC Ltd , GMR- Hyderabad International Airport Ltd, Mumbai International Airport Ltd
Tirumala-Tirupati Devasthanam etc. We have been also the pioneer in taking Insurance to rural masses
with large level implementation of Universal Health Insurance Programme of Government of India &
Vijaya Raji Janani Kalyan Yojana ( covering 45 lakhs women in the state of Madhya Pradesh) , Tsunami
Jan Bima Yojana (in 4 states covering 4.59 lakhs of families) , National Livestock Insurance and many
such schemes.
 News and media

Wheels on food street

OUR SPECIAL CORRESPONDENT

The Park Mansions property that will house Nexa

Exit pizzas, enter wheels. The Park Street property that housed Pizza Hut till a few days ago
will soon host Nexa, Maruti's premium sales outlet.

Company officials said the outlet, on the ground floor of Park Mansions, would be inaugurated
next month.

Nexa is positioned as "a modern retail channel with an exclusive network of new-age
automotive showrooms across India". It will kick off with the launch of the Maruti S-Cross, the
premium crossover that will only bear the Suzuki tag.

"Since we are going to be in the most prime area in Calcutta, we expect a good footfall and
good branding," said a Maruti official in charge of the Nexa showroom.
Maruti planning 100 NEXA showrooms by FY16
PTI | Aug 6, 2015, 06.42 PM IST

Several new models would likely be

added to both channels as part of the Company's medium term goal of 2 milli... Read More

KOLKATA: Maruti Suzuki India Limited (MSIL)is planning to have 100 exclusive NEXA
showrooms across the country by the end of this financial year, a senior official said here on
Thursday.

NEXA, Maruti's new premium sales channel, would go beyond selling premium cars in a bid to
transform the company from "budget car manufacturers" to a crucial player in the premium car
market in India, senior vice president (New channel) Marketing & Sales Maruti Suzuki Partho
Banerjee said here.

Banerjee was speaking on the sidelines of the launch of MSIL's premium crossover vehicle S-
Cross here with an introductory price range of Rs 8.34 lakh and Rs 14.37 lakh (ex-showroom
Kolkata).

"NEXA provides a new experience of hospitality from Maruti Suzuki. Currently, we have 35
NEXA Premium showrooms operational in different cities and the numbers are expected to go
beyond 100 outlets by the end of this financial year," Banerjee said.
Kolkata has one NEXA showroom at Chetla while another will come up at Park Street this
month end, he said.

Incidentally, the company has recruited around 1100 "relationship managers" who would
manage these NEXA showrooms.

"All you would need to do is contact just one of them for all your needs and problems. MSIL
promises high-level pampering of the customers with the new digital experience," Banerjee said.

The S-Cross would be available only in diesel engine options of 1.6 litre and 1.3 litre. The DDiS
200 (1.3 litre) variant is priced between Rs 8.82 lakh and Rs 11.30 lakh while the DDiS 320 (1.6
litre) trims have been priced between Rs 12.57 lakh and Rs 14.37 lakh (all prices ex-showroom
Kolkata).

S-Cross is the first car to be sold under NEXA. Several new models would likely be added to
both channels as part of the Company's medium term goal of 2 million annual sales by 2020.

13 October, 2015
Maruti Suzuki opens bookings for Baleno, the all-new premium hatchback

05 August, 2015
India gets its first premium cross-over, S-
CROSS
 23 July, 2015
Maruti Suzuki launches NEXA: A New Premium Automotive
Experience

08 July, 2015
Maruti Suzuki opens booking for its premium crossover S-
CROSS

Products & Services :-

Loss or damage to your car due to natural calamities

Fire, explosion, self-ignition or lightning, earthquake, flood, typhoon, hurricane, storm, tempest,
inundation, cyclone, hailstorm, frost, landslide and rockslide.

Loss or damage to your car against man-made calamities

Burglary, theft, riot, strike, malicious act, accident by external means, terrorist activity, any
damage in transit by road, rail, inland waterway, lift, elevator or air.

Personal Accident Cover

Coverage of Rs. 2 lakh for the owner-driver of the vehicle while driving or travelling and
mounting or dismounting from the Four-wheeler. Optional personal accident covers for
Passenger/ Paid Driver/ driver/ Insured are also available

Third Party Legal Liability

Protection against legal liability due to accidental damages caused to the surrounding property
and/ or resulting in permanent injury or death of a person.
Add on Covers with your Motor Insurance/Car Insurance policy

A Motor Insurance/Car Insurance policy is only complete once it exceeds the satisfaction of
providing security and peace of mind, which is why we have introduced add-on covers that will
be of use any time you are in a crisis situation.
 24x7 Spot Assistance
This is a Pan-India cover for car insurance policyholders who need assistance while on the road.
This includes providing service for emergencies such as repair of flat tyre, jump start for car
battery, legal advice in case of an accident and many more.
Lock and key replacement cover
In the event of an irrecoverable loss of keys or a security risk arising out of a loss of the same,
you will be indemnified for the cost incurred in fitting or purchasing new locks or replacement
of keys of the insured vehicle

Accident Shield
Compensations will be made for total permanent disability or death of occupants (other than a
paid driver), which arises out of bodily injury due to an accident that takes place while they are
traveling in the insured car
Consumable Expenses
Cost of consumables such as Engine oil, Gear box oil, Power steering oil, coolant, AC gas oil,
Brake oil, etc. that may be incurred while replacing/replenishing the damaged vehicle, following
an accident, will be covered by our Car Insurance/Motor insurance policy
Conveyance benefit
If the insured car is in a workshop following accidental damage and the claim for the same is
accepted, the insured would get a 'per day' cash benefit, as per the plan opted by the insured
Personal baggage
The Insured is indemnified in case of any loss or damage caused to his/her personal
baggage kept in their insured vehicle. Damage caused by the covered perils is covered in
under Bajaj Allianz's Motor Insurance/Car Insurance policy
PROCESS

Claim Process for General Insurance

 Every insurance company presents its best facet while selling a plan but it is the Claim
Settlement that really decides how good the company really is. As a buyer you should
ideally look for 3 factors while making a purchase
Claim settlement ratio The number of claims settled by the company to the total
number of claims filed in a financial year.
Incurred claim ratio The total amount spent on claims to the total amount earned as a
premium by the insurance company in a financial year.
Claim settlement turnaround time It signifies the time span between the filing of a
claim and settling of a claim. In other words, it is the time taken by the insurance
company to settle a claim.
The basic outline of a claim process for the general insurance is -
SWOT ANALYSIS

STRENGHTS WEAKNESS OPPORTUNATIES THREATS

1.Good number of 1 . company 1. Insurance 1. new players
service partners still not big industry is on a coming in the
2. covering all enough to boom market
parts of motor have stable 2. collection of 2. lot of
insurance market premium is higher competition in
3. Good locations than claims after the market
4. good employee recent reform
strength
5.direct seller of
maruti cars
OUR COMPRTITORS:-
 INDUSTRY OVERVIEW

General insurance covers insurance of property against fire, burglary, theft; personal
insurance covering health, travel and accidents; and liability insurance covering legal
liabilities. This category of insurance virtually covers all forms of insurance except life.
Other covers may include insurance against errors and omissions for professionals, credit
insurance etc. Common forms of general insurance are motor, fire, home, m arine, health,
travel, accident and other miscellaneous forms of non-life insurance.
Unlike life insurance policies, the tenure of general insurance policies is normally not that
of a lifetime. The usual term lasts for the duration of a particular economic activity or for
a given period of time. Most general insurance products are annual contracts. There are
however, a few products which have a long term.
List of General Insurance Companies in India
Public Sector Private Sector Other General Insurance
Companies Specialised

1. Agriculture Insurance Co. 1. Apollo Munich Health 1. ECGC Ltd. (formerly

of India Ltd. Insurance Co. Ltd. Export Credit Guarantee
2. National Insurance Co. 2. Bajaj Allianz General Corporation of India Ltd.)
Ltd. Insurance Co. Ltd. 2. General Insurance
3. The New India Assurance 3. Bharti AXA General Corporation of India
Co. Ltd. Insurance Co. Ltd.
4. The Oriental Insurance Co.4. Cholamandalam MS
Ltd. General Insurance Co. Ltd.
5. United India Insurance Co.5. CignaTTK Health
Ltd. Insurance Co. Ltd.
6. Future Generali India
Insurance Co. Ltd.
7. HDFC ERGO General
Insurance Co. Ltd.
8. IFFCO-Tokio General
Insurance Co. Ltd.
9. Kotak Mahindra General
Insurance Co. Ltd.
10. L&T General Insurance
Co. Ltd.
11. Liberty Videocon General
Insurance Co. Ltd.
12. Magma HDI General
Insurance Co. Ltd.
 13. Max Bupa Health
Insurance Co. Ltd.
14. Raheja QBE General
Insurance Co. Ltd.
15. Reliance General Insurance
Co. Ltd.
16. Religare Health Insurance
Co. Ltd.
17. Royal Sundaram Alliance
Insurance Co. Ltd.
18. SBI General Insurance Co.
Ltd.
19. Shriram General Insurance
Co. Ltd.
20. Star Health and Allied
Insurance Co. Ltd.
21. Tata AIG General
Insurance Co. Ltd.
22. Universal Sompo General
Insurance Co. Ltd.

Non-Life Insurance Industry Business Figures

Gross Direct Premium Income Underwritten for and up to March 2016 (Rs. in crore)

Category of March % Growth Cumulative Figures (up % Growth (year

Insurers (month on to March) on year)
month)
2015-16 2014-15 2015-16 2014-15

Private Sector 3928.07 3524.83 11.4% 39701.12 35090.06 13.1%

Public Sector 5101.19 4550.92 12.1% 47717.36 42550.97 12.1%

Stand-alone Health 623.93 488.18 39.2% 4153.77 2942.56 41.2%

Specialised 366.65 543.07 -32.5% 483012 4102.10 17.7%

Grand Total 10019.84 9067.00 10.5% 96402.37 84685.69 13.8%

Challenges for the industry

The insurance industry in the country is undergoing multiple disruptions in its functioning and
the trend will accelerate in the future. The operating and business models of insurers have been
evolving due to the disaggregation of the insurance value chain, according to the report prepared
by industry body Assocham in collaboration with Ashvin Parekh Advisory Services.
Recent technology trends such as artificial intelligence (AI), machine learning, blockchain and
robotic process automation (RPA) have significant potential to streamline insurance operations
and enhance customer experience, it added. Insurers have begun capitalising this potential of
technology to address rising customer demands and expectations.
Where the major task has been customer acquisition and services for the insurance industry,
technology has made it easier to manage the sourcing by way of interactive machine learning and
artificial intelligence tools, the report said.
Three disruptions including technology, financing of insurance companies and the policy and
regulations will perhaps pose new challenges for the industry, Ashvin Parekh, Managing
Partner, Ashvin Parekh Advisory Services said in a statement.
At least four insurers, including ICICI Lombard, Birla Sun Life, PNB MetLife and HDFC Life
are already using advanced technology for either customer support or sales. At the same time,
two new-age non-life insurers Acko and Digit Insurance have received the final approval
from the insurance regulator IRDAI to do business in India. Both companies are relying on their
technology platforms to differentiate themselves and plan to replicate the e-commerce service
experience that customers are used to.
As per the report, the insurance sector has grown fairly well in the past one year, with both life
and non-life sectors recording higher than previous year premiums. The average growth rate for
the industry has been around 10-12 percent.
Challenges ahead
Despite the positive waves in the sector, the industrys ability to confront structural and
technological changes remain at risk, according to CSFIs latest Insurance Banana Skins 2017
survey, conducted with support from PwC,surveyed 836 insurance practitioners and industry
observers in 52 countries, including in India, to find out where they saw the greatest risks over
the next 2-3 years.
Change management is at the head of a cluster of operating risks which have jumped to the top
of the rankings. The report raises concerns about the industrys ability to address the formidable
agenda of digitisation, new competition, consolidation and cost reduction it faces, especially
because of rapidly emerging technologies such as mobility solutions and artificial intelligence.
This has also been highlighted as a significant risk by the Indian insurers.
While regulatory risks have reduced [though the cost and complication of regulation continue to
be a concern] the report shows that the industrys ability to attract and retain human talent is a
fast-rising concern, particularly to handle the digital challenge. In fact, insurers from India rated
human talent as the top risk. The dearth of skilled workers (eg. actuaries, cyber risk experts)
needs to be addressed differently.
According to Singhel, the poor continue to be the biggest sufferers of this phenomenon. He was,
however, optimistic of the growth of insurance demand with the rise of asset creation among
people.
Studies reveal that companies are adopting strategies of open workers or outsourcing of the
function, especially. for seasonal work. This provides the added advantage of significant
reduction in cost.
Solutions to Some of the Challenges
The companies are trying to sell its products in tier-III towns and remote locations by setting up
virtual sales offices and has equipped its sales people with devices to bring customers on board
and service them. It also participates in various government schemes like Pradhan Mantri Fasal
Bima Yojana to increase the penetration of its insurance products. The Indian insurance sector is
conceivably as longstanding as the banking industry, but it has seen a sea change in business
expansion and disclosure standards over the past 10-15 years. The Insurance Regulatory and
Development Authority of India (Irdai), which was instituted in 2000, opened the insurance
sector to private enterprises allowing Indian companies to partner with foreign establishments.
This has redefined the insurance sector, allowing common people to have adequate financial
cover at reasonable cost. A developed and evolved insurance sector is a catalyst for economic
development of a country. It provides long-term funds for various developmental activities and
simultaneously strengthens the risk-taking ability of the country.

Strong insurance IPO pipeline

This year is a landmark year for the Indian insurance sector as a spate of initial public offerings
(IPO) are expected from leading insurance companies, with at least 5-6 in advanced stages of
hitting the bourses. Irdais move to relax capital raising norms last August (allowing insurance
companies over 10 years to go public), has pushed many companies to tap Indian capital
markets. Industry estimates suggest that insurance companies are eyeing a mop-up of Rs30,000-
35,000 crore this financial year. Union Cabinet has also approved the public listing of five state-
owned general insurance companies, and reduction of governments stake to 75% from 100%.
The current buoyancy in Indian stock markets, which are trading near all-time highs, should also
support these public issues.

Indian insurance sector consists of 57 companies, out of which 24 are life insurance, 31 general
insurance, and two are re-insurance companies. Ironically, there are only three listings on the
stock exchanges.
However, the public listing initiative by insurance companies has gained tremendous momentum
this year, with growth potential in the sector and acceptability among institutional and retail
investors. This signifies increasing traction in the sector on the IPO front. Listing is also a step
towards improving disclosure standards and their periodicity, which will make businesses
answerable to investors, and society in general. Till a decade ago, there was little transparency in
terms of policy details, claims and surrender rates. The insurance regulator changed the
landscape by bringing in more disclosures.

Future Prospects

Indias economy gives further impetus to international investors interests, leaving constructive
circumstances to attract IPOs in the insurance sector. A public listing fundamentally amends a
companys legal and economic structure. The management becomes more accountable to a new
group of shareholders, unlike the concentrated ownership of a private company. Information
regarding the companys financial health and operations, which were kept private, gets publicly
disclosed. This reflects on the companys performance in many areas including: growth,
innovation, managing fraud, customer service, and regulatory compliance.

The IPO channel is essentially taken by companies to raise capital for expansion of operations,
increase liquidity for shareholders, improve brand image and create valuable currency stocks that
can be used to make acquisitions and compensate employees. An IPO also enhances a
companys public profileincreasing its visibility and giving recognition of its products and
services. This progressively benefits customers as the company constantly brings in better
products and enhanced service standards to remain proficient, while outspreading penetration of
insurance services.

Indian insurance IPO market is taking off at a time when the sector itself is poised for a giant
leap. Indias insurance market is expected to quadruple in size over the next 10 years from its
current size of $60 billion, according to a report published by India Brand Equity Foundation
(IBEF), an initiative of the Ministry of Commerce and Industry, Government of India. This is an
opportunity waiting to be harnessed. India currently accounts for less than 1.5% of worlds total
insurance premiums and about 2% of its life insurance premiums, despite being the second most
populous nation.

Indias insurable population is anticipated to touch 750 million by 2020, with life expectancy
reaching 74 years. In addition, life insurance is projected to comprise 35% of total savings by
end of this decade, as against 26% in 2009-10. There is substantial potential for growth in the
sector due to several factors that include initiatives like Pradhan Mantri Jan-Dhan Yojana aimed
towards enhancing financial inclusion, raising financial literacy along with increase in domestic
savings, expanding coverage of crop insurance, expected revival of the investment cycle, and
increasing penetration of auto and health insurance. Demographic factors such as a growing
middle class, young insurable population and growing awareness for protection and retirement
planning will also support the growth of Indian insurance companies. The country is the 15th
largest insurance market in the world in terms of premium volume, and has the potential to grow
exponentially. This certainly makes a strong case for insurance companies to unlock value and
tap stock markets for future expansion plans.

OBJECTIVES OF THE PROJECT

The study of this topic has been undertaken with a number of objectives. Following are the
objectives of this study
a) To understand the insurance and general insurance in deep
b) Current scenario in the insurance industry
c) Ability of client to focus on core business
d) To study the motor insurance
 Research Methodology

SELECTION OF SUBJECT:
The subject selected to study on Cost and time savings for the client and warehousing,
inventory management and damage control.

METHODS USED FOR COLLECTION DATA:

Both primary and secondary methods were used.

METHODS USED FOR COLLECTION DATA:

Both primary and secondary methods were used.

The primary data was collected through interview in few general insurance
companies

The secondary data was collected through the means of internet, office database.

a) Primary Data:-
i) Personal Interviews

b) Secondary Data:-
i) Web reference
ii) 3rd Party reference
iii) Existing Companys Report

Data Collection Instrument Development: - DTDC Employees

Research Limitation:-
a) Limited base time for the Project.
 DATA ANALYSIS & INTERPRITATION

India is the fifth largest insurance market in Asia owing to its USD 30 billion net worth of
insurance industry. At present, there are 52 insurance companies in India of which 24 are into
life insurance business while 28 are into non-life insurance. Motor insurance contributes to about
44 per cent of the entire market portfolio primarily because it is statutory under law.
Motor insurance provides protection for a vehicle against financial loss as well as liability that
could result from an accident or a theft. The two types of policies available under this are:
a) Own damage
b) Third party
Own damage insurance covers liability against damages to ones own vehicle as well as damages
to the vehicle and injury or death of the third party.
Third party claim is a coverage category of motor insurance where the insurance company agrees
to cover the policyholder, if sued in the court of law or held legally liable for injuries as well as
damages to the third party.
Typically, third party claim policies cover vehicle collision and physical injury to the human life
as mandated by law (The Motor Vehicles (MV) Act, 1988 directs compensation payment to the
victims of accidents due to usage of motor vehicle (s), in public places by the owner (s), as the
case may be).
Historically, the claims ratio for such type has been as high as 140-170 per cent, i.e., for every Rs
100 collected as premium, Rs 140 to Rs. 170 is being paid out as claims. To tackle these adverse
payouts and for efficient management of losses as well as leakages, effective April 2007, an
insurance pool has been set up for third party liability coverage among all insurance companies.
Premiums and losses get inducted into this pool and the net results of the pool are shared by all
insurance companies, which will be proportional to their market share in all lines of business
combined. General Insurance Company (GIC) Re manages this pool at a fee of 2.5 per cent of
the pooled premium and also assumes statutory reinsurance cessions from it. Thus, these systems
had and will continue to ensure that the coverage will be subjected to tariff control. Insurance
companies receive 10 per cent of the premiums as servicing fee.
The Indian insurance industry cannot avoid claims except on a certain ground as defined under
Section 149 (2), which has been brought into limelight by the Supreme Court of India.
Many insurance companies are being vigilant and using this law extensively to plug leakages and
effectively manage the claim ratio.
Under various provisions, the insurance company has also been given the right to recover the
said amount paid to the third party from the owner. This recovery can be made by filing an
execution application and not by a separate civil suit.
Legal defence available for insurers to dishonour the claim are:
 Not holding driving license or holding fake license or carrying gratuitous passenger, provided
the same is within knowledge of the owner.
If the intentions are proved wilful and nefarious.
In December 2011, IRDA had dismantled the third-party motor pool system based on the
repeated appeals from general insurers that loss ratios of some companies have improved, but not
to the desired levels. This move had freed the pricing model and insurers were able to price
based on their own claims experience and business goals (for instance: choosing to concentrate
on certain segments-cherry picking).
As of 2015, this structure hasnt brought a stupendous change, but the insurer is looking towards
future with optimism.

Types of motor policies

When you buy a motor vehicle, you need to buy a motor insurance. There are, however, many
types of motor insurance policies available. The common types are:
Third party cover - This policy insures you against claims for bodily injuries or deaths
caused to other persons (known as the third party), as well as loss or damage to third party
property caused by your vehicle.
Third party, fire and theft cover - This policy provides insurance against claims for third
party bodily injury and death, third party property loss or damage, and loss or damage to
your own vehicle due to accidental fire or theft.
 Comprehensive cover - This policy provides the widest coverage, i.e. third party bodily
injury and death, third party property loss or damage and loss or damage to your own
vehicle due to accidental fire, theft or an accident.
Exclusions/Extensions
A standard motor insurance will not cover certain losses, such as your own death or bodily
injury due to a motor accident, your liability against claims from passengers in your vehicle (except
for passengers of hired vehicles such as taxis and buses) and loss or damage arising from an act of
nature, such as flood, storm and landslide. However, you may pay additional premiums to extend
your policy to cover flood, landslide, landslip as well as cover your passengers.
Important points to consider when buying motor insurance policies
Insured value/sum insured: If you are buying a policy against loss/damage to your vehicle, you
must ensure that your vehicle is adequately insured as it will affect the amount you can claim in
the event of loss/damage. For a new vehicle, the insured value will be the purchase price while for
other vehicles, the insured value is the market value of the vehicle at the point you apply for the
insurance policy.
Under-insurance If you insure your vehicle at a lower sum than its market value, you will
be deemed as self-insured for the difference, i.e. in the event of loss/damage, you will only
be partially compensated (up to the proportion of insurance) by your insurance company.
Over-insurance Should you insure your vehicle at a higher sum than its market value, the
maximum compensation you will receive is the market value of the vehicle as the policy
owner cannot profit from a motor insurance claim.
Duty of disclosure: You should disclose fully all material facts, including previous accidents (if
any), modification to engines, etc. When in doubt as to whether a fact is relevant or not, it is best
to ask your insurance company. If you fail to disclose any material fact, your insurance company
may refuse to pay your claim or any claim made by a third party against you. In such cases, you
are personally liable for such claims.
Price: The price you pay for your motor insurance will depend on the type of policy selected. The
insurance premium charged by your insurance company is the standard minimum rate in
accordance with the Motor Tariff. However, in addition to the standard minimum rate, your
insurance company may impose additional premiums known as loadings to the premium payable
in view of higher risk factors involved such as age of vehicle and claims experience.
No-claim-discount: The premium payable may be reduced if you have no-claim-discount (NCD)
entitlement. NCD is a reward scheme for you if no claim was made against your policy during
the preceding 12 months of policy. Different NCD rates are applicable for different classes of
vehicles. For a private car, the scale of NCD ranges from 25% to 55% as provided in the policy.
Transfer of ownership: In case of any sale of vehicle involving transfer of policy, the insured
should apply to the insurer for consent to such transfer. The transfer is allowed, if within 15 days
of receipt of application, the insurer does not reject the plea. The transferee shall apply within
fourteen days from the date of transfer in writing to the insurer who has insured the vehicle, with
the details of the registration of the vehicle, the date of transfer of the vehicle, the previous owner
of the vehicle and the number and date of the insurance policy so that the insurer may make the
necessary changes in his record and issue fresh Certificate of Insurance.
Excess: Also known as a deductible. This is the amount of loss you have to bear before your
insurance company will pay for the balance of your vehicle damage claim. The types of excess
applicable are as follows:
Compulsory excess of RM400: If your vehicle is driven by a person not named in
your policy or a person named in your policy who is under the age of 21, the holder of
a provisional (L) driving license or the holder of a full driving license of less than two
years.
Other excess: applicable at the discretion of your insurance company and in some
cases, no excess is imposed. You can negotiate with your insurance company on this
excess.
What you should do in the event of an accident/loss
Take notes of the accident If you are involved in a motor accident, take notes of the accident,
i.e. the names and addresses of all drivers and passengers involved, vehicle registration
numbers, make and model of each vehicle involved, the drivers licence numbers and insurance
identification as well as the names and addresses of as many witnesses as possible
Make a police report You are required by law to lodge a police report within 24 hours of a
road accident.
Notify your insurance company You must notify your insurance company in writing with
full details as soon as possible. Depending on the type of claim you intend to make, you may
have to notify other insurance companies. If you fail to report the accident, you will be liable
for your own loss as well as any third party claim against you.
Select the workshop You must send your damaged vehicle to a workshop approved by your
insurance company. If the accident occurs during office hours, you may call the hotline/
emergency assistance numbers provided by your insurance company. Otherwise, you may call
your insurance company for the nearest approved workshop. Should the accident occur outside
office hours and you are making a claim against your policy, i.e. an own damage claim, you
should ensure that your vehicle is towed to a workshop approved under Repairers Scheme.
Claim Settlement
Claim arises when:
1) The insureds vehicle is damaged or any loss incurred.
2) Any legal liability is incurred for death of or bodily injury
3) Or damage to the third partys property.
The claim settlement in India is done by opting for any of the following by the insurance company.
Replacement or reinstatement of vehicle
 Payment of repair charges
In case, the motor vehicle is damaged due to accident it can be repaired and brought back to
working condition. If the repair is beyond repair then the insured can claim for total loss or for a
new vehicle. It is based on the market value of the vehicle at the time of loss. Motor insurance
claims are settled in three stages. In the first stage the insured will inform the insurer about loss.
The loss is registered in claim register. In the second stage, the automobile surveyor will assess
the causes of loss and extent of loss. He will submit the claim report showing the cost of repairs
and replacement charges etc. In the third stage, the claim is examined based on the report submitted
by the surveyor and his recommendations. The insurance company may then authorize the repairs.
After the vehicle is repaired, insurance company pays the charges directly to the repairer or to the
insured if he had paid the repair charges.
Section 110 of Motor Vehicle Act, 1939 empowers the State Government in establishing
motor claim tribunals. These tribunals will help in settling the third party claims for the minimum
amount
Theft claims
After submission of the claim form, you must cooperate fully with your insurance company
or its representative during the course of investigation of the theft claim.
In view that the police and your insurance company will require time to investigate your
claim, you will receive the offer of settlement from your insurance company within six
months from the theft notification or upon completion of police investigations, whichever is
earlier
 SUGGESTION

The insurance industry is likely to get a facelift in days to come. If the recommendations of the
Finance Ministry committee are implemented, it can entirely change the way insurance policies
are bought and sold in India.
Earlier in November 2014, the Finance Ministry had constituted a nine-member committee to
review distribution incentives across financial products, rationalize commission structure and
recommend measures to curb mis-selling. The committee, headed by Sumit Bose, former Union
Finance Secretary, had submitted the report in August which was made public on September 3.
Here are the seven key recommendations that can change the face of the insurance industry:
Transparency in premium disclosure: The committee has proposed that insurance companies
should expl1icitly give breakup of premium amount expense ratio, mortality charges and
investment.
IRDAI norms allow insurance companies with over 10 years of operation to deduct up to 90% of
first year premium and 15% of renewal premium towards expenses. Such deductions can go even
higher for the companies which have not completed 10 years.
This would help policyholders understand the cost of policies and make informed decisions.
Stringent performance metric: Hitherto, only experts could gauge the performance of insurance
policies. However, if the recommendation of the committee goes through, even a lay person will
be able to assess the performance.
The committee has recommended using relevant benchmark (created by an independent agency)
to measure the performance. Apart from this, the committee has recommended benchmarking of
mortality costs against the mortality tables created by independent actuarial firms.
Meanwhile, the current practice of disclosing returns in which insurers use sum assured and
maturity benefit to depict inflated returns may end. Insurance companies are advised to indicate
returns based on actual performance of the policy. The current practice of showing future returns
benchmarked to 4% and 8% should be discontinued since forecasting of returns is misleading,
states the committee report.
Insurers may be required to disclosure internal rate of return (IRR) on guaranteed return policies
(non-participating policies). On ULIPs, the committee has recommended disclosing NAV after
deducting expenses.
Meanwhile, the committee has advised insurance companies not to use the word bonus while
calculating returns. The current practice of using the word bonus to indicate return is
misleading. Disclosures should use the word net return instead. Changing the way we call
something has an impact on the way we think about it, recommended the committee.
Reasonable refund value: Another key recommendation is on surrender value. The committee
has recommended that insurance companies should pay reasonable amount to policyholders after
deducting costs and charges on surrendering of a policy. Currently, surrender value is calculated
by discounting a certain percentage on paid up value which is generally much lower than the
premium paid.
Single expense ratio: The committee has recommended that all charges like distribution cost,
management fee and R&T charges should be clubbed under one head. No charges would be
deducted towards premium allocation charge. In addition to management fee, insurance companies
currently deduct charges for allotting fund towards mortality and investment.
Lapsation benefit to all: Insurers may not be able to utilize the corpus of lapsed policy. Instead,
the committee has suggested that insurance companies should pass on this benefit to the
policyholders of ULIPs.
Stringent disclosure: The committee has recommended that insurance companies should
periodically disclose asset allocation and portfolios on their websites. Also, insurance companies
were advised to provide an online calculator to help people calculate paid up value and surrender
value so that customers can better understand the consequence of exits across each year.
Commission: The committee has recommended continuation of upfront commission in traditional
policies and ULIPs. However, such commissions would be paid on mortality charges or the part
of premium paid towards availing life cover.
The committee has recommended that insurance companies should pay a fixed percentage of
premium till the tenure of non-participating policies as renewal commission or trial commission.
Participating policies which distribute realized gains among policyholders, should pay trail
commission based on assets under management.
Among other key recommendations are putting an end to the practice of paying advance
commissions to distributors, passing back of commission to policyholders and using riskometer to
depict risk level in ULIPs.
Though these recommendations may help policyholders make informed decisions, it may
transform the insurance industry as it exists today. Generally, policyholders have no idea where
their premium goes. Traditional life insurance policies typically deliver 4-6% return. Such a return
may not attract anyone to invest. If these recommendations go through, insurance companies
would have to rethink their strategy.
In a column published in The Economic Times, Dhirendra Kumar, CEO, ValueResearch wrote,
A customer with even minimal financial literacy would instantly be able to see that going for a
separate life cover (term insurance) and any other investment even a recurring deposit in the
post office or a bank would be a better option than endowment plans and other such horrors
that our insurance industry runs.
 Conclusion

The insurance industry in India has changed rapidly in the challenging economic environment
throughout the world. In the current scenario, Indian insurance companies have become
competitive in nature and are providing appropriate distribution channels to get the maximum
benefit and serve customers in manifold ways.
Indian Insurance industry has big opportunity to expand, given the large population and untapped
potential. The insurance market in India has witnessed dynamic changes including entry of a
number of global insurers. Most of the private insurance companies are joint ventures with
recognized foreign institutions across the globe. Saturation of markets in many developed
economies has made the Indian market even more attractive for global insurance majors.

The Indian Insurance Industry has undergone several changes in trends and policies since the year
2010.
Insurance companies not only provide risk cover to infrastructure projects, they also contribute
long-term funds. In fact, insurance companies are an ideal source of long term debt and equity for
infrastructure projects. With long term liability, they get a good asset- liability match by investing
their funds in such projects. IRDA regulations require insurance companies to invest not less than
15 percent of their funds in infrastructure and social sectors. International Insurance companies
also invest their funds in such projects.
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