PRAYAS

Case Study Competition

“ICICI Lombard”

Q.1 What is the role of insurance companies in the development sector?

Ans. Insurance today has become an integral part of the whole financial system. Insurance is a win-win

game. It is beneficial for both insurer and insured. On one side the insurer gets the premium and on the

other the insured gets risk free future. Our lives are full of uncertainty and risks. We can’t anticipate what

will happen at the next moment. Avoiding risks is not our cup of tea but mitigating risks is.

Insurance companies are playing a vital role in the development of Individuals, society

Entrepreneurs, Corporate, Economy, Government and a nation as a whole.

Role of insurance companies in the development of Individuals:

A medium to save and invest money

Social security-

Sense of security and safety

Employment generation

Aid at the time of-

Old age and retirement

Education

Marriage

Risks related with fire, theft, accidents and others.

Mobilization of savings

Stressed free people leads to happy people and thus developed economy.

When people invest in insurance, they are left with lesser amount. It will reduce the demand of

goods and thus it will reduce inflation.

Financial stability

Reap the benefits of young age in old age.

Role of insurance companies in the development of Corporate:

Insurance is a stimulation of commerce, trade and industry as a whole.

Transfer of risks ensures smooth functioning of business.

Insurance helps to avoid disruptions of operations and thus aids in the survival and long life of

business.

Insurance facilitates specialization of labor by taking over the burden of risk since it specializes in

bearing of risks.

Optimum utilization of capital to generate more wealth.

Increment in credit worthiness.

Role of insurance companies in the development of Country:

Aid to Foreign trade

Insurance provides development opportunity to those larger industries having more risks in

setting up.

Thus we can conclude that insurance companies play a vital role in the development of whole economy.

Q.2 What is the potential of insurance sector in India after Privatization?

Ans. Privatization refers to that process by which the participation of state and public sector in economic

activities is reduced. The main aim of privatization is to allow the private sector to run and manage the

industries and to minimize the reservation made for public sector. In other words, the implementation of

the policy of denationalization is called privatization.

Concept of Privatization on one hand, puts restriction on public sector and on the other provides

concessions, reliefs, allowances and facilities for the expansion of private sector.

Impact of Privatization in India, which would have positive impact on insurance sector are:

Growth of Financial Markets

Growth of industrial sector

Growth of Banks

Developments in higher Education

Growth of Technology

Insurance sector in India has a bright future because Indian Economy is growing by leaps and bounds. A

huge part of India either does not know about insurance or do not have any type of insurance. In such a

condition India has lots of opportunity to get insured. In every sector Education, Technology, Finance,

Health our country is developing. India has a huge population and thus a vast potential in insurance sector.

Yesterday there were only few name like LIC and GIC in the insurance sector but today almost every bank

and financial organization is a part of Insurance sector. HDFC Standard life Insurance Co. Ltd. And Max

New York life insurance are the emerging names.

Potential of Insurance sector in India:

Introduction of Foreign Direct Investment in the Insurance has also showcased the wide horizons

of insurance sector.

Customer satisfaction and Customer Delight have become the soul objectives of market, thus

Insurance companies have wide opportunities to innovate its practices.

Awareness of customers towards their life, house, property, vehicle, family are enticing people to

opt for insurance.

Increasing Risks

An increasing trend of salaries and high packaged jobs among younger generation has increased

the purchasing power thus people will have more money for savings and insurance.

Privatization has opened the way for various private colleges and schools. An increase in the

number of literate people also has opened avenues for insurance sector.

Q.3 What are the business processes used in ICICI Lombard an what ar the challenges faced by the

company?

Ans. Business process used in ICICI Lombard includes-

Setting of customer claims

Sale of its products through various channels.

ICICI Lombard has various personal and Business products.

Personal Products:

Health Insurance

Home Insurance

Motor Insurance

Overseas travel Insurance

Domestic Travel Insurance

Student Medical Insurance

Business Products

Fire Insurance

Marine Insurance

Industrial Insurance

Corporate Insurance

Liability Insurance

Credit Insurance

Channels

Sales Executives

Sales force

Agents

Brokers

Online

Banks

Bancassurance channel

Telesales Channel

Challenges faced by the ICICI Lombard in its Business Processes:

Delayed deadlines

Buyer dissatisfaction as it is difficult to have an exact information about the needs, likes

and preferences of the customer.

It is also not easy to understand that Who, What, Why, When and how will buy the

product.

Competitive Analysis

In telesales customers hate to receive cold calls, if they receive also they do not respond

properly.

Some people find it difficult to navigate through the online channel.

Sales force in the insurance sector is overburdened with the targets and it creates

uncongenial aura at the workplace.

Lapse of policies

Fixation of premium amount ( Competitor’s Pricing)

Claim Settlement is a tough process sometimes Insurance Companies have to suffer loss.

Q.4 What are the ways in which MIS can help to overcome the challenges mentioned in

Q.3?

Ans. Information is an important resource for managers. A Management Information System

may be defined as a complex interaction among people, computer and computer

technologies, and procedures designed to quickly provide relevant data or information,

collected both from internal and external organizational sources, for organizational use.

MIS is designed to acquire, store and convert data in to timely relevant information to help

managers carry out the planning, control and operation and operational functions of the

organizations.

MIS i.e. Management Information System is the solution to the various problems of any

organization. In case of ICICI Lombard also MIS is an efficient tool to face and solve all its

challenges.

BENEFITS of MIS:

Use of Premia and Genesis Pathfinder results in to

Reduced Times

Increased Revenues

Decreased costs

Management of issues and policies

Manage critical insurance functions

Integrated Collaborative portal server (CPS)

Improved speed and accuracy

Ease of claim settlements

Customer Relationship Management

Better Customer service

Customer satisfaction

Customer delight

Citrix Metaframe enables

Faster rollout of applications

Proper database Management

Data mining

Data storing

Better information systems

Increased efficiency of the organization

Flexibility in easy modification of data

These benefits of MIS prove that Management Information system enables the smooth functioning at

each level of ICICI Lombard. It helps in the improvement of Business processes.

Purvi Jain

Shri Venketeshwar Institute of Technology

Indore