NAFLIA - a roaring success yet again
The much anticipated second National Forum
for Life Insurance Advisors (NAFLIA) was
held recently at the Waters Edge. The unique
event has been hailed for bringing together
the best insurance advisors in the country.
NAFLIA is the brainchild of the Insurance
Association of Sri Lanka (IASL) and is aimed
at further improving the life insurance
Speaking to The Sunday Leader Chairman,
Insurance Board of Sri Lanka, Dr. Gamini
Wikramasinghe stated that the event not only
brought together the cream of the life
insurance industry, but was also a unique
learning experience facilitating the
exchange of ideas.
He stated that the forum was a novel concept
that would promote improved understanding
within the industry and better servicing.
Dr. Wikramasinghe also noted that the
turnout of over 600 participants was
reassuring and viewed the increasing level
of young people taking up the profession as
a positive factor.
"Life insurance professionals have
played a major role in the development and
popularisation of the life insurance
business in the country but we still see an
immense untapped potential which exists
within the sector," said Dr.
He added that insurance is a growing
industry reflecting solid growth rates.
Meanwhile President, Insurance Association
of Sri Lanka, Jagath Alwis stated that the
forum was patronised by not only local
insurance professionals but international
presenters as well, creating a comprehensive
knowledge pool for the participants, some of
whom represented the north and east of the
"The re-insurance giant Munch Re,
Insurance Board of Sri Lanka as well as the
Sri Lanka Insurance Institute supported this
endeavour and this year the forum was
conducted under the special theme 'Pledge
For Life' and all insurance companies sent
their best to take part in this forum which
was an ideal opportunity for them to
exchange their views and common concerns. We
also plan on making this an annual event
where the cream of the industry will meet
once a year," said Alwis.
Explaining the 'Pledge For Life' theme,
Alwis said that it would comprise a code of
conduct that an insurance advisor should
adhere to. He also said that the organising
committee hopes to someday make NAFLIA a
Chairman, Organising Committee, NAFLIA,
Rukman Weerarathne stated that the most
important aspect of the event is that it
provides a forum for discussion on many
aspects of life insurance advisors'
responsibilities and to share the knowledge
gained from the field.
"We've seen a strong commitment shown
by the turnout this year at NAFLIA and that
is truly remarkable. In years to come we
know that events like NAFLIA will only
continue to help the insurance industry
further strengthen itself and reach greater
heights," Weerarathne said.
NAFLIA is a project of the Insurance
Association of Sri Lanka (IASL), realising
the importance and emerging need for further
improvement of the life insurance industry,
brought together the best life insurance
advisors in the country by organising the
National Forum for Life Insurance Advisors (NAFLIA).
Janashakthi growing at a rapid pace
With the Janashakthi IPO oversubscribed in
double quick time The Sunday Leader met up
with Managing Director, Janashakthi
Insurance, Prakash Schaffter to catch up on
the latest developments.
By Kshanika Argent
Q: How successful was the recent share
A: We were 4.5 times oversubscribed and
announced the closure within three hours of
The IPO was a resounding success not only
from Janashakthi's perspective but also from
a national point of view.
The share market as we all know has
been extremely dull over the last 24 months.
This should surely give a fillip to
the stock market and will hopefully be the
beginning of a revival.
Q: How has been the company's performance in
the first five months of this year (in terms
of revenue and profit after tax)?
A: The company's performance in the first
five months of this year has been up to the
In terms of revenue we are just short
of our budgeted revenues but this has to be
viewed in the light of an increased emphasis
on bottom line performance which has
resulted in shedding some classes of
business which we viewed as being
As far as profits are concerned I am
not in a position to comment as we are now a
public listed company other than to say that
it is in line with expectations.
Q: There is a theory that insurance,
particularly life insurance has been growing
in recent times due to the country's
A: I am not aware of any theory that life
insurance grows in times of volatility. In
fact it is quite the opposite. During
periods of economic instability (high
inflation) life insurance is more often than
not the first casualty.
People who are struggling to make
ends meet, especially in emerging economies
such as ours often tighten belts by lapsing
their existing life policies.
There is also a greater reluctance on
the part of people to take out life policies
at times when they are unable to meet their
Q: Life insurance penetration is said to be
What is Janashakthi and the industry
at large doing to increase penetration?
A: There is really no reliable figure
available that indicates the extent of life
But one thing I am sure of is that
there is scope for greater penetration in
Janashakthi has made efforts
to increase the current level of
penetration by recruiting large numbers of
agents and other permanent sales staff. We
currently have a field force of 3000 who are
dedicated to selling life insurance.
We also invest a considerable sum of
training our field force to sell life
We not only teach them the art of selling
the art of selling according to people's
At a macro level it is the industry
body which is endeavouring to popularise the
concept of life insurance nationally.
Q: In the context of high inflation in the
country, how do you expect insurance to grow
when people are finding it hard to make ends
This is what I just outlined - during
economic uncertainty people do not have the
money to make ends meet and are therefore
reluctant to take out life insurance in such
Q: What is Janashakthi's position in the
A: Janashakthi is currently one of Sri
Lanka's leading insurers.
Our net asset worth exceeds Rs. 2.1
billion which is well in excess of the
proposed 2012 capital requirements set out
by the Insurance Board of Sri Lanka.
We have consistently delivered
profits to our shareholders and have
exceeded a figure of Rs.500 million both in
2006 and 2007. We are also one of the fastest growing companies and have
rapidly expanded our market share over the
Q: Where does Janashakthi stand with regard
to the new IBSL capital requirements ?
A: The Insurance Board of Sri Lanka has
indicated that it will be revising the
current minimum capital requirements of
insurance companies. This is I believe to keep pace with inflation which has taken
place over the years as well as
to further build on the security that
insurance companies provide their customers.
The Insurance Board of Sri Lanka has
proposed a capital requirement of Rs. 1
billion for composite companies in the year
2012. We exceeded the 2012 requirement in 2007.
A reflection of the financial
strength of Janashakthi.Q: If such a mandate
comes into effect splitting insurance
companies in two, what is Janashakthi's
A: The industry has been making
representations to the Insurance Board on
the necessity to refrain from splitting the
We are hopeful that the Insurance
Board will realise the negatives of
splitting current insurance companies and
will review their current position.
Q: Why should people opt for life insurance
instead of saving in a bank?
A: Life insurance is a form of protection.
It is a means whereby a family can
ensure that in the event of the death of a
bread winner they are financially provided
for. Life insurance could combine an element
of saving as well and in many cases does so.
In the case of bank's however, life
insurance cover is not provided and they are
pure savings instruments.
Only registered insurers can provide
Q: What are Janashakthi's plans after the
A: We have been quite clear on the reasons
for raising fresh capital from the public
and have consistently enunciated this at all
times. There is no change as far as we are concerned.
Our plans for the funds raised by the
IPO is to expand our branch network
as well as our field sales force.
We will also further improve our
brand visibility by means of above the line
and below the line campaigns.
All in all, we want to expand
aggressively on the base that we have built
up in our initial years.
Q: When will trading begin ?
A: I believe that trading will begin around
the third week of July.
Q: What are Janashakthi's targets for 2008 ?
A: Janashakthi has set relatively ambitious
targets for 2008.
We have based on past performance and
current market conditions set ourselves
ambitious sales as well as bottom
The one major change at Janashakthi
that has taken place gradually over the last
12 to 18 months is the much greater emphasis
on bottom line delivery as opposed to top
Q: How many branches do you have ?
A: We currently have 115 branches and it is
our plan to open branches in selective
locations based on the business potential
that exist in that area.
Q: Are there any alternatives to expanding
than opening more branches ?
A: I would not wish to use the term
alternatives to opening more branches but
rather state that there are complimentary
methods of expanding business.
Tie ups with banks or bancassurance
as it is more commonly known is yet another
way of expanding our business.
The growth of the internet too will
in the future serve as an important means of
transacting insurance business.
Q: How many people do you employ ?
A: We currently employ
2,250 staff. Over 50% are field sales
employees who are out on the field
Q: What are Janashakthi's future plans ?
A: We have over a space of 14 years built a
successful and viable business entity.
We have a long history in the
insurance business which even precedes
Janashakthi and our plan is to build on the
achievements of the past , to continue to do
what we have done but to do it better and
faster giving stakeholders, both investors
and policyholders superior returns.
Participants will gain valuable experience
Eleven from Sri Lanka Insurance to attend
MDRT in Ontario
Sri Lanka Insurance with 46 years of
experience serving Sri Lankans around the
island, has had 11 of its outstanding
performers selected for the prestigious
Million Dollar Round Table (MDRT) Annual
Meeting to be held this year from June 22-26
in Ontario, Canada.
Membership at MDRT is the highest
association that a life insurance
professional could aspire to reach.
More than 6000 members from different areas
of the United States and more than 60
countries participate annually to share
ideas, adapt to new perspectives and take
home with them a priceless experience that
inevitably enables them to serve their
customers and their employees even better.
This interaction between the 'cream of
society' in the financial and life insurance
services in the world is a tremendous
milestone in one's career as it serves to
improve customer commitment, professional
knowledge and strict ethical conduct.
Despite the low penetration in the insurance
market in Sri Lanka the competition has
steadily increased and service providers are
constantly seeking new methods to offer a
better and more comprehensive service. The
MDRT is one such opportunity to be in touch
with all the modern technicalities of the
profession with the sharing of expertise on
advanced sales ideas, technical information
and motivational concepts.
CEO-Life of Sri Lanka Insurance, Suresh
Paranavithana commenting on this achievement
said "I congratulate all members of the
Sri Lanka Insurance team who are
participating at this year's
MDRT. The experience the team gains
from participating and being
acknowledged as a prestigious member of MDRT
and acts as a momentum to motivate
and inspire each and every individual. With
the learning experience, these members
extract a mammoth amount of professionalism,
excellent selling (insights) and knowledge
but above all they adhere to a strict Code
The 11 participants from Sri Lanka Insurance
includes N.G.D.Nissanka, V.Nandakumarm,
A.Sivakantha, M.M.S.K.Nawaratne, M.Ravi,
K.N.Indika, S.M.M.G.Subasinghe Banda,
P.M.Balasuriya, and K.Sivapathasundaram
Sri Lanka Insurance is the largest and
strongest composite insurance provider in
Sri Lanka, with over Rs 58 billion in assets
under management, over one million policies
in force and an average claims settlement of
Rs. 21 million a day. The company also
claims the largest life fund in the
insurance industry which is Rs. 38 billion.
Sri Lanka Insurance is the first insurance
company in Sri Lanka to be assigned a global
rating for financial strength and stability
from a world renowned rating agency. The
company received the AA-(lka) from Fitch
Ratings London for the third consecutive
year for financial strength and stability.
Zero drownings in Anuradhapura this Poson;
three lives saved
Eagle's 15th Poson Safety Campaign a great
This year's Poson season recorded the rescue
of only three persons from drowning, a great
reduction in the need for rescues and zero
drowning-related deaths among the
approximately one million pilgrims who
visited the sacred city of Anuradhapura.
Eagle Insurance conducted the Poson Safety
Campaign for the 15th consecutive year with
the support of the Sri Lanka Police, Navy
and the Life Saving Association by utilising
630 professional lifeguards. The lifeguards
of the Life Saving Association, who saved
three individuals are, L.M.G.S. de Mel,
K.M.A. Chamith Wasantha, Manjula Dinesh
Bandara and Yaminda Chamil.
The focus of the campaign was to safeguard
the lives of devotees from drowning when
bathing in nearby reservoirs. Eagle
initiated a massive public awareness
campaign prior to and throughout Poson to
advice people against using unsuitable
bathing places and highlighting the need to
act with extra caution when bathing in
Large billboards and warning signboards
indicated unsafe-spots that should be
avoided for bathing while guiding pilgrims
to safer bathing areas. Leaflets, in both
text and picture-form, were disseminated on
maintaining proper safety procedures; and
about 100,000 fact-sheets were distributed
near major tanks and at official-monitoring
terminals at selected locations before
In 1993, Eagle in collaboration with the
Life Saving Association, Police Department
and the Navy initiated the Poson Safety
Campaign, which has continued ever since.
This project has helped in reducing the rate
of drowning during the Poson season to
nearly zero. Through the committed efforts
of Eagle, this campaign has so far helped
rescue more than 128 pilgrims as of 2008.
Last year, during the campaign nine pilgrims
The Eagle Poson Safety Awareness Campaign is
part of the company's comprehensive CSR
strategy. At Eagle, being ethical and
socially responsible is a way-of-life and is
a fundamental core value of the company,
which Eagle champions ardently, a statement
China's insurers may pay
$290 million in quake claims
China's insurers may pay 2 billion yuan
($290 million) in claims from the nation's
most powerful earthquake since 1950,
analysts say. That's less than 1 percent of
their premium income in the first five
months of 2008.
"Earthquake claims should be
absorbable," said Standard & Poor's
analyst Connie Wong in Hong Kong. The bigger
concern is this year's 46 percent slump in
the benchmark CSI 300 stock index, she said.
Profits at China Life Insurance Co. and Ping
An Insurance (Group) Co., the nation's
biggest insurance companies, may decline
because of the drop in equity prices, and as
claims from the earthquake and the worst
snowstorms in 50 years during January
continue to mount, Wu Dingfu, chairman of
China's insurance regulator, said last month
that insurers must "become more
vigilant than ever about controlling
BNP Paribas SA doubled its estimate for
insured claims from the earthquake to 2
billion yuan after the industry's regulator
prodded companies to make
"goodwill" payments that may not
technically be covered under policies, said
Dorris Chen, an analyst at the Paris-based
bank in Shanghai. The estimate is equal to
0.4 percent of Chinese insurers'
"There're a lot of ambiguities about
what is covered and what isn't," Olive
Xia, a Core Pacific Yamaichi analyst in
The $290 million in estimated claim payments
is only 1.5 percent of the more than $20
billion of damages from the quake estimated
by a China Insurance Regulatory Commission
The May 12 earthquake, the most powerful to
hit China since a magnitude 8.6 quake struck
Tibet in 1950, killed 69,181 people as of
June 22 and injured 374,171, China's
official Xinhua news agency reported. The
country's seismology department said the
Sichuan quake had a magnitude of 8, while
the USGS put the magnitude at 7.9.
China Life, the nation's biggest insurer,
has said it may pay 230 million yuan in
claims from the May 12 earthquake. The cost
would equal 0.2 percent of the company's
151.5 billion yuan of premiums in January
through May. The Beijing-based insurer may
eventually pay up to 700 million yuan,
Life insurers will face larger claims since
their policies include earthquake coverage,
while most property policies do not, said
S&P's Wong. China Life may face most of
the life insurance claims, Wong said.
China Life had about 43 percent of the
nation's life insurance market in the first
five months of this year, according to data
from the China Insurance Regulatory
Commission. The company commanded 60 percent
to 70 percent market share in most of
China's rural regions in 2006.
Professionalism the theme
behind Asian Alliance Insurance
Asian Alliance Insurance (AAI) which over
the last eight years achieved several
important milestones, has comfortably become
an intrinsic part of Sri Lankan life,
winning kudos from the public as a
completely professional organisation,
offering tailor-made insurance solutions to
a discerning clientele. AAI has achieved
this success through understanding the
unique needs of individuals and offering
insurance solutions that is best suited to
According to Assistant General Manager -
Marketing, Asian Alliance Insurance, Nadi
Dharmasiri the company fully deserves the
accolades it receives, as she firmly
believes that Asian Alliance Insurance has
perfected the art of providing a
professional service, along with insurance
solutions that are intuitively geared to
suit the needs of a discerning public,
representing multitudinous walks of life.
Recalling the historic milestones of mankind
and the outstanding and dynamic people
behind them, Dharmasiri indicated that such
achievements have been the result of a
"great combination and a perfect
partnership," which resulted in
unprecedented changes in the way we live.
In this vein, she recalled the achievements
of the inventor of the telephone - Alexander
Graham Bell, who had the firm support of A.
Watson; the first conqueror of Everest - Sir
Edmund Hillary, who was unconditionally
aided by Tenzing Norgay ;
and the King of the skies - Orville
Wright, who had Wilbur Wright standing right
She pointed out that all these amazing
achievements were the result of
"perfect partnerships," adding
that Asian Alliance Insurance sought to be
just such a partner to its clientele in the
modern era. "We represent this
platform, as the base upon which these
extraordinary partnerships were built, -
which is explicitly explained in our current
advertising campaign line, 'Great Truth.
Great Trust. Great Partnerships.'"
Asian Alliance Insurance renowned as an
innovator of insurance solutions, which are
more suited to public needs, and tailor-made
to suit their wants, is in the process of
introducing unconventional insurance
channels to the public using new
technologies such as the internet, SMS and
also Over the Counter (OTC)
insurance products through supermarkets, banks, and innovative channels of
This, the company believes will sit well
with the modern, busy lives of most people,
as it is centred around convenience, said
Dharmasiri. Even as at now the company is offering "buy on
line" insurance solutions via the AAI
And as a CSR initiative, Asian Alliance
Insurance is involved in fostering
professional ideals among school children,
brightening their future, while opening new
vistas of growth for the nation building
effort. Under the theme "Contributing
Towards Moulding Future Professionals"
Asian Alliance Insurance has been
instrumental in organising numerous
programmes in many schools along with their
regional distribution network in various
parts of the country.
Selected school events such as
prefects' day, sports meets, prize givings,
and inter school events are the focus of
Further, Asian Alliance Insurance (AAI)
became the "Official Insurer" of
the recently concluded Annual Exhibition and
Awards Ceremony of the Sri Lanka Printers
Going one step further the company
also educated the forum of more than 500
entrepreneurs engaged in printing on the
basics of insurance and its benefits.
AAI has already agreed to partner the
National Chamber of Exporters as the
"Principal Sponsor" for the Annual
Export Awards which is scheduled to take
place in September. AAI sees this as its
contribution towards helping the exporters
at this very crucial point in time
with their role in developing the economy.
Asian Alliance Insurance has also over the
last four years continuously provided road
and insurance tips both in the English and
Sinhala media on an hourly basis over the
radio, minimising accidents and fostering a
and education with regard to the
concept of insurance, among the Sri Lankan
This has been well received by the
Dharmasiri concluded that Asian Alliance
Insurance, as a home grown company, over the
last eight years, has delivered results and
continued to grow, owing to a far reaching
visionary approach, coupled seamlessly with
unparalleled action, indicating that none of
these achievements would have been possible
if not for the perfect partnership and
harmony between employees, management,
clients and all its stakeholders. "This
is indeed the hallmark of
professionalism," she said.
Union Assurance top achievers to attend MDRT
in Ontario, Canada
Million Dollar Round Table (MDRT) includes
the world's most successful insurance and
financial services professionals. Attending
the MDRT is the dream of any life insurance
advisor as a life and career-changing event,
since it gives them the opportunity to
network with other successful producers and
hear from the world's most prominent
Seven top achievers of the Union Assurance
Life sales force were qualified to attend
the prestigious MDRT (Million Dollar Round
Table) Annual Conference 2008 to be held in
Ontario, Canada from June 22 to 26. The MDRT
Annual Meeting is themed "Changing
Lives." Union Assurance will bear the
full cost of sponsorship for all the
The MDRT qualifying achievers were
recognised at the recently concluded award
ceremony held at Waters Edge, Battaramulla
for their outstanding performance during the
The team comprises of
Prasanna Senarathne, Senior Personnel
Financial Manager, Kurunegala Branch, who
also won the most coveted award
'Champion of Champions' at the Union
Assurance Annual Awards Ceremony and
participates for the fourth time;Udan Silva,
Senior Personnel Financial Manager of
Kalutara Branch who has the privilege of
attending the conference for the seventh
consecutive year; A. Edirveerasingam, Senior
Personnel Financial Manager of City Branch
who attends the MDRT conference for the
fourth consecutive year; and H.D.J.C.
Appuhamy of Chilaw Branch who attends the
MDRT conference for the second consecutive
Other star performers who qualified for this
year's conference are
Kapila Tharanga, Senior Personal
Financial Advisor of Moneragala Branch,
G. S. S
Kumara, Personnel Financial Advisor of Chilaw Branch and M.T.J.
Jeyaraj, Personnel Financial Advisor of
The team was accompanied by Assistant
General Manager Life Distribution, Nalaka
Dharmaratne who received a special
invitation for the MDRT Conference.
Indian stock brokers moving in to insurance
In a clear bid to insulate themselves from
the vagaries of the stock market and offer a
basket of financial products to their
clients, many Indian stock brokers have got
into the insurance broking business.
Brokers like Religare, Anand Rathi,
Edelwiess, Emkay and India Infoline have set
up insurance broking arms, through which
they sell both life and non-life insurance
products of several companies. While an
insurance agent typically can sell products
of only one insurance company, an insurance
broker can sell products of multiple
In India, insurance broking picked up only a
couple of years ago, due to stringent norms
which made it necessary for the brokers to
have a capital of at least Rs 50 lakhs.
Besides this, the business needs to be
conducted in a separate company, it should
have a different office other than the
broking office and it should have separate
set of employees.
Religare Insurance Broking already has 1,300
people on its roll and it generated premium
worth Rs 107 crores for the year ended March
"We aim to expand the business five
fold to Rs 500 crore of premium by March
2009," said President, Religare
Insurance Broking, Chandan Sinha. The
company has 57 branches across the country,
which are in addition to the stock broking
branches. Anand Rathi has a team of 100
people with 15 offices across the country.
Insurance broking is not easy as one has to
interact with as many as 25 different
companies for selling products, which could
be a daunting task. Besides, training a
sales force to sell multiple products is a
big challenge, say analysts. However, in a
bid to give the best deal to a customer, it
is imperative to be an insurance broker.
"Insurance (life and non-life) is
unaffected by the vagaries of the stock
market and it helps derisk the business
model," says Senior Vice-President,
P.Saravanan. Sharekhan was till
recently a corporate agent of ICICI
Prudential Life Insurance. Plans to get into
insurance broking in a couple of months are
on the anvil, he adds.
"Insurance is a sticky business. If I
can help my clients in getting the motor
claims or mediclaims, I can cross sell other
products too," says Supriya Rathi,
principal officer and director, Anand Rathi
Insurance Brokers. They generated a premium
of Rs 80 crore last year. "The process
is currently at a nascent stage. With more
value addition, clients realise that the
benefits will be manifold and growth will be
faster," says Akhilesh K Singh, head of
wealth management, Emkay Shares.
With markets falling by about 6,000 points
from the peak of January 2008, insurance
broking seems to offer a ray of hope. At
present, we have about 250 insurance brokers
in the country. The biggest in the business
are Aon and Marsh, both multinational
companies who are also into reinsurance
80% Indians do not plan for retirement
According to a MetLife India Insurance
survey, over 80% Indian employees have done
no retirement planning independent of any
mandatory government plans.
Giving details of the other countries, the
survey further added that over 81% Mexican
employees, 58% Australian employees, 46%
employees based in the US and over 31% of
the UK employees, have not taken any steps
to determine income need or any sort of
These are the findings of the two MetLife
surveys - the inaugural Study of
International Employee Benefits Trends (iEBTS),
and the sixth annual U.S. Study of Employee
Benefits Trends (EBTS).
Managing Director, MetLife India Insurance
Co.Ltd., Rajesh Relan said, "Despite
worries about funding a comfortable
retirement or outliving their retirement
savings, many full-time workers in
developing and mature economies, have taken
few or no independent steps to plan for
In India, while almost three out of four
employees (71%) say they are
"concerned" about outliving
retirement money, only one out of every
three (35%) say they have taken steps to
determine retirement needs; only 20% say
they have done actual planning for
Further, in a sharp departure from the other
countries surveyed, one-third (33%) of
Indian employees say they never expect to
retire - which may account for why 80% of
all employees say they have not done any
Of those Indian workers who have planned for
retirement, nearly six out of ten (58%) say
they have either achieved or are on track to
achieving their retirement goals.
Many of the employees surveyed recognise the
importance of retirement benefits and
expressed interest in receiving both
financial and retirement planning products
through the workplace.
Nearly half of Indian employees (48%) whose
employers do not offer retirement benefits
would be interested in purchasing retirement
planning products through their employer,
even if they had to pay 100% of the cost.
About two in every three Mexican employees
(66%) are interested in receiving advice
from a financial advisor regarding their
In the US, the desire for financial planning
guidance is on the rise; nearly half of
employees surveyed (49%) are interested in
financial planning assistance for retirement
issues, up from 38% the previous year.
More than a half (54%) of Australian
employers are receptive to offering
financial planning services, including
personalised advice, to employees and nearly
one-third of employees are interested in
having employers provide this type of
In the UK, 61% of employees already consult
with financial professionals, and 29% of
employees are interested in having their
employers offer this service.
Overwhelming response for Union Call &
n the web
Have you ever dreamt of getting your own
motor insurance policy without having to go
through a person or organisation? Well dream
no more your wish has already become a
reality with Union 'clickandgo.'
This is the latest convenience for Sri
Lankan vehicle owners and is an initiative
by Union Assurance PLC who revolutionised
motor insurance with the Union Motor Call
& Go insurance policy by giving
customers the distinct advantage of not
having to worry about the hassle and
inconvenience of taking care of the details
after an accident.
Through this policy, customers who encounter
an accident can immediately contact the
Union Assurance Call Centre, log an entry
and drive on. Union Assurance has introduced
the Call & Go policy to its customers
Riding on the success of their 'innovation'
platform Union Assurance have used web
technology to simplify the process further
by making the insurance policy available on
the web for the convenience of customers.
Now the public have the advantage of
accessing all the relevant information
required to obtain the Call & Go
insurance policy online, input their credit
card details and obtain a print of their
motor insurance certificate and receipt
within a matter of minutes from anywhere
Once an insurance policy has been obtained
online the company will arrange with
customers to have the vehicle inspected, no
claim bonuses verified etc. at a time and
place convenient to them.
This is a fully integrated and automated
system, with minimum manual intervention
guaranteeing security and protection of
customer information offering many
conveniences to customers such as 24 x 7
x365 accessibility, quick price checks etc.
Even first time web purchasers are assured a
smooth, worry free transaction thanks to the
24 hr telephone helpline, where senior
officers of Union Assurance are on call to
guide customer who want the comfort of
knowing help is at hand. All this and the
additional assurance of knowing there is a
14 day no questions asked money back
We caught up with Senior Manager Market
Development, Kennedy J. Michael to find out
what the customers had to say. He said
"Going by what customers who have
already bought the policy online say, the
freedom to customise ones cover and work at
ones own pace have been the most appreciated
of the many features of clickandgo."
He continued "The customer response has
been overwhelming for our special web
discount and have your premium wiped off
promotions which will run till the 30th of
June. What we did was - create the type of
hype required to make a radical idea like
buying motor insurance off the web catch on.
We now know that purchases on the web will
work if accompanied with the right
experience and intend bringing more daring
and exciting offers in the future."
This was the response when we asked what
other facilities are being offered.
"Another aspect that we have added on
is the M-burse facility - a tie up with
Commercial Bank where - customers can
receive claim settlements in minutes over
the counter from any branch of Commercial
Bank. This SMS based payment methodology can
be used even by non Commercial Bank
customers and is applicable to all classes
of motor insurance.
"Union Assurance as always made very
simple propositions leveraging the prevalent
technology which provide customers a unique,
efficient and affordable method of
purchasing Insurance," he added.
Small players diversifying into insurance
After the rush of Indian conglomerates and
foreign insurers in all segments of the
underwriting business, domestic companies,
which service these firms in the life and
non-life categories, are charting growth
strategies in new areas.
A host of family-run companies that were
earlier confined to a segment of the
insurance services business, are now
venturing into other areas.
For instance, the Apollo Group, promoted by
the Reddys, has ventured into the broking
segment by acquiring E-Meditek.
Similarly, Bhaichand Amulok Group, which has
an insurance and reinsurance broking company
called Bhaichand Amoluk Consultancy
Services, has acquired a 26 per cent stake
in another broking firm Willis BA. Willis
BA, one of the largest players in brokerage
market, holds shares in a TPA called Health
A TPA is a specialised health service
provider rendering a variety of services,
like arranging for hospitalisation and
processing and settling claims. On the other
hand, an insurance broker's job is to get
the best cover with the lowest premium for
its corporate clients. There are 30 TPAs
registered with Irda, which managed premiums
of Rs 4,400 crore in 2007-08.
A host of other promoters, such as
Delhi-based Vipul group, Alankit and
Safeway, Heritage, are in the TPA segment as
well as the broking business. There are many
others, such as broking outfit India Insure
Risk Management Services, which plan to have
a presence in more than one segment of the
insurance services market.
While the service providers are venturing
into related fields, many in the insurance
industry are complaining that regulations
prohibit brokers from processing claims.
Also, at the time of renewal of big ticket
corporate policies, insurance brokers do not
disclose the information that they have
gathered from TPAs to insurance companies.
Experts said that there is a possible
conflict of interest, too, as TPAs, with
broking arms, may entertain borderline
claims associated with the clients.
An official of the Insurance Regulatory
& Development Authority of India,
however, pointed out that while issuing
licences, the regulator tries to ensure that
there is no common promoter or director.
"If the two companies (the insurance
broker and TPA) are within the same group,
there should be different directors and
different promoters for the two
companies," the source said.
New wave of outsourcing catching on as
companies drift East
WHEN Irish insurance company Hibernian last
week announced plans to outsource almost 600
back office jobs to a low-cost centre in
Bangalore, India ears perked up in insurance
headquarters all over Dublin.
Eastern outsourcing is by no means a new
phenomenon in the industry -- KPMG estimates
the insurance sector contributed $790m to
the local Indian economy last year -- but,
so far, no Irish companies have embraced the
international trend with the vigour now
shown by Ireland's largest insurer
Suddenly, a floodgate had been opened, or so
If the move makes sense for Hibernian, would
it not make similar sense for the scores of
other insurers? If Hibernian wasn't afraid
to make the very politically incorrect
decision, then why should other companies
continue to shy away?
A flurry of conversations with Ireland's
leading insurance executives, however,
reveals that Hibernian's move would seem
unlikely to provoke a wave of outsourcing,
though most are careful not to rule it out
Sources point out that Hibernian's situation
is a very specific one. The insurer's
parent, Aviva, already has a substantial
outsourcing operation with 6,500 staff
employed to service the substantial markets
of the UK and Canada. Hibernian chief
executive Stuart Purdy admits the job
creation demanded by adding the Irish
business to the fold will be nothing like
the hundreds of jobs lost here.
Others point out that Hibernian is
distinctly different to other insurance
companies because of its "run from a
head office mentality."
Stuart Purdy recently arrived from Scotland
to take the helm at the Irish operations
after doing a stint in India. Aviva's
rotational structure could see him heading
for pastures new again in a few years' time.
"It's almost like the Nigel effect,
managed by the UK with no loyalty to
Ireland," a rival executive said.
Another chief executive of an insurance
company puts it more bluntly: "I'm
Irish and I have an interest in jobs staying
Executives of other insurers also have a
fundamental philosophical argument with
Hibernian's move, which they say dissuaded
them from following a similar direction.
"If people are going to prosper and buy
things like car insurance they need to have
jobs, so it's incumbent on all of us to
maintain a healthy economy," says Axa
marketing boss Paul Moloney.
"Setting up an offshore centre doesn't
further that." Hibernian is not the
only Irish insurance company with a parent
who has dabbled in international
outsourcing, and sources suggest companies
whose parents have already beaten the Indian
route are more likely to move jobs from here
to India. As one executive puts it:
"Ireland is a minor piece of the
international puzzle for anyone.
"If companies are looking to do it
(outsourcing) for the first time, they'll be
looking to do it somewhere much bigger than
Irish insurers with existing links to
outsourcing include Axa, Allianz Standard
Life, Bank of Ireland Life/New Ireland and
Friends First owner Eureko.
"Internationally, Axa has a major back
office in Bangalore. Over the years we've
been under a lot of pressure to see what
support we can give that operation,"
"We've argued that it didn't fit with
our strategy here, we're based around being
a local company.
"When we added everything up, it wasn't
worth the cost difference."
With about 1,000 staff based in Ireland, Axa
is one of Ireland's largest insurers by
headcount and has continued to increase its
numbers despite shedding 40pc of its
revenues over the past three years amid a
fiercely competitive general insurance
business. "That does put us under
pressure, but we'll make sure that pressure
doesn't lead to India," says Moloney.
Allianz, which employs close to 900 in
Ireland, also has a group offshoot in India.
"We have a different business model to
Hibernian and have no plans for a similar
jobs outsourcing exercise," a spokesman
said in a statement.