Premium Essay

Insurance & Risk Management

In: Business and Management

Submitted By khanash
Words 4817
Pages 20
PROJECT OUTLINE

* Acknowledgement * History of EFU Insurance * Vision * Mission * Policies Offered By EFU Insurance * Detail About Policies * Coverage Under Policies * Risk Management * Claims * Payment of claims and Process * Duration of Policies * Marketing Plan

ACKNOWLEDGEMENT

All the Acclimations and Appreciation are for Almighty ALLAH, the Compassionate; the Benevolent. That knows the mysteries & secrets of universe.
We would like to show the special gratitude to MISS Khudaija who provided with us knowledge Vision about the management.
At the end, we would like to thank all who directly or indirectly help us in making the project.

Introduction:-

In 1932, Mr. Ghulam Mohammad, a far sighted man, established Eastern Federal Union Insurance Company (EFU) with financial assistance from the Aga Khan III and the Nawab of Bhopal. Mr. Abdur Rehman Siddiqui became the founder chairman. The company was originally registered at Kolkata and operated in India (undivided) and Burma.

In 1947, on the birth of Pakistan, EFU found a new home in a new country. In Pakistan, EFU rapidly established itself as a progressive and innovative insurer. It gave the emerging insurance industry the leadership, the manpower and the drive needed to grow in a situation where at one time, three-fourths of insurance was held by foreign companies.

By 1961, EFU had become the flag bearer of Pakistan's insurance industry on the world stage, and the largest life company in Afro-Asian countries (excluding Japan) under the leadership of Mr. Roshen Ali Bhimjee. It remained so until 1972 when Life Assurance business in Pakistan was nationalized. Thereafter EFU operated solely as a General Insurance Company, and was subsequently renamed EFU General Insurance Limited. Now EFU General is the largest…...

Similar Documents

Premium Essay

Risk Management

...addition there are many risks faced by the construction industry in order to achieve its aim. 1.2. Objective of the study The major objective of this report writing is to understand various risk faced by an industry or an organizations and their ways and techniques to handle all these risk. But apart from that the other objectives of this study are: 1. To understand different types of risk facing organization. 2. To understand the trend of risk analysis in Nepalese construction market. 3. To know the techniques used to manage loss exposure unit 4. To find out the problem faced while managing risk 5. To know what methods are usually followed to reduce risks in construction companies? 6. To know benefits and significance of risk management 1.3. Research methodology There are many methods of collecting data. For the purpose of preparation of this report, direct interviews with respondents were taken and questionnaires were prepared. However secondary sources of data like annual general report and other journals published by the respective organizations were also taken into consideration. 1.4. Limitation of the study There were few limitations that I had to face while preparing this report. There are as follows: * There is lack of faith towards the information collectors from the side of organizations. Hence, only limited information was available to prepare this report. * As the trends of risk analysis are not......

Words: 2406 - Pages: 10

Premium Essay

Risk Management

...tRESEARCH ON LAPSE IN LIFE INSURANCE WHAT HAS BEEN DONE AND WHAT NEEDS TO BE DONE? MARTIN ELING MICHAEL KOCHANSKI WORKING PAPERS ON RISK MANAGEMENT AND INSURANCE NO. 126 EDITED BY HATO SCHMEISER CHAIR FOR RISK MANAGEMENT AND INSURANCE DECEMBER 2012 Research on Lapse in Life Insurance—What Has Been Done and What Needs to Be Done? Martin Eling, Michael Kochanski This version: 2012/12/23 _________________________________________________________________________________________ Abstract The intention of this paper is to review research on lapse in life insurance and to outline potential new areas of research in this field. We consider theoretical lapse rate models as well as empirical research on life insurance lapse and provide a classification of these two streams of research. More than 50 theoretical and empirical papers from this important field of research are reviewed. Challenges for lapse rate modeling, lapse risk mitigation techniques, and possible trends in future lapse behavior are discussed. The risks arising from lapse are of high economic importance. As such, lapsation is of interest not only to academics, but is also highly relevant for the industry, regulators, and policymakers. JEL classification: G22; G28 Keywords: Lapse; Surrender; Lapse Modeling; Life Insurance _________________________________________________________________________________________ 1. Introduction Today’s insurance policies allow policyholders to choose......

Words: 9582 - Pages: 39

Free Essay

Risk Management & Insurance on Reliance Insurance Company

...approaches and methodologies are required to be followed. The following approaches were followed in conducting this term paper. 1.1 Origin of the Report: The report is a partial requirement of the course Risk Management & Insurance (FIN 410). That is why our honorable instructor assigned us to do a term paper on Reliance Insurance Company Limited. The report is conducted based on the financial statement and the website of the company. This report is a reflection of what we have learned in between the course. 1.2 Objective and the Scope of the Report: The report was prepared as a part of our course work. The basic objectives of preparing this report are: * Analyze the financial statement of the insurance company and calculate different ratios. * Different policy the company offers. * Overall structure of the company. 1.3 Methodology of the Report: The term paper was based on different numeric values collected from the financial statement of the company and plotting them in different equations, also some information regarding the company was collected from the company’s website 1.4 Sources of Data: All the data and the information which was required to complete the term paper have been collected from the financial statements and the website of Reliance Insurance Company Ltd. That means, only secondary sources of data was used to complete the term paper, no primary source was used. 1.6 Limitations of the study: Of course this term paper is not flawless and......

Words: 2938 - Pages: 12

Free Essay

Risk Management

...The Influence of Enterprise Risk Management on Insurers’ Stock Market Performance: An Event Analysis   Dr. Madhu Acharyya                                                                        Copyright 2009 by the Society of Actuaries.  All rights reserved by the Society of Actuaries. Permission is granted to make brief excerpts for a published  review.  Permission  is  also  granted  to  make  limited  numbers  of  copies  of  items  in  this  monograph  for  personal, internal,  classroom or  other instructional  use,  on  condition  that the  foregoing  copyright  notice is  used so as to give reasonable notice of the Society's copyright. This consent for free limited copying without  prior  consent  of  the  Society  does  not  extend  to  making  copies  for  general  distribution,  for  advertising  or  promotional purposes, for inclusion in new collective works or for resale.  Abstract    Enterprise  risk  management  (ERM)  increases  shareholder  value.  In  this  study  we  test  whether  ERM  influences  insurers’  stock  market  performance.  The  results  indicate  that  insurers’  stock  market  performance  is  linked  to  the  characteristic  of  industry  events  and  specific  firm  characteristics  rather  than to the success of ERM. In this study the 2007–2008 subprime mortgage and financial market crisis  was found unique compared to other industry events. The study recommends further research on the  methodology  of  determining  the ......

Words: 4987 - Pages: 20

Premium Essay

Risk & Uncertainty in Insurance

...Meaning of Risk: Risk is defined as the probability of an event and its consequences. Risk management is the practice of using processes, methods and tools for managing these risks. Meaning of Uncertainty: Uncertainty is a state where the extent of risk and when the risk hits is unknown, (ie) – we know what the risk is but are uncertain of the outcome yet. The main categories of risk to consider are: • Strategic Risk: Strategic risks are those risks associated with operating in a particular industry. - for example a competitor coming on to the market • Compliance: Compliance risks are those associated with the need to comply with laws and regulations. They also apply to the need to act in a manner which investors and customers expect, for example, by ensuring proper corporate governance.- for example the introduction of new health and safety legislation • Financial: Financial risks are associated with the financial structure of your business, the transactions your business makes and the financial systems you already have in place. -for example non-payment by a customer or increased interest charges on a business loan • Operational: Operational risks are associated with your business' operational and administrative procedures- for example the breakdown or theft of key equipment Other risks include: • environmental risks, including natural disasters • employee risk management, such as maintaining sufficient staff numbers and cover, employee safety and......

Words: 370 - Pages: 2

Premium Essay

Insurance and Risk Management

...INSURANCE AND RISK 1.0 Definition of insurance. Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount of money to be charged for a certain amount of insurance coverage is called the premium. Categories of risk include:- 1. Financial risks which means that the risk must have financial measurement. 2. Pure risks which means that the risk must be real and not related to gambling 3. Particular risks which means that these risks are not widespread in their effect, for example such as earthquake risk for the region prone to it. 1.1 Basic Characteristics of insurance. The insurance has the following characteristics which are, generally, observed in case of life, marine, fire and general insurances. 1.Sharing of Risk:- Insurance is a device to share the financial losses which might befall on an individual or his family on the happening of a specified event. The event may be death of a bread-winner to the family in the case of life insurance, marine-perils in marine insurance, fire in fire insurance and other certain events in general insurance, e.g., theft in burglary insurance, accident in motor insurance, etc. The loss arising nom these events if......

Words: 1778 - Pages: 8

Premium Essay

Management Insurance

...when your company goes bankrupt to collect insurance money or buying insurance on someone with yourself as beneficiary and then killing them); and * morale hazards, like a careless attitude since "insurance will pay for it."   b. Define physical hazard, moral hazard, attitudinal. hazard, and legal hazard. (1) Physical hazard: physical environment which could increase or decrease the probability or severity of a loss. It can be managed through risk-improvement, insurance policy terms, and premium rates. (2) Moral hazard: attitude and ethical conduct of the insured. It cannot be managed but can be avoided by declining to insure the risk. Read more: http://www.businessdictionary.com/definition/hazard.html#ixzz3PRGECZxS 4. a. Explain the difference between pure risk and speculative risk 1. Pure Risk situations are those where there is a possibility of loss or no loss. There is no gain to the individual or the organization. WHERE AS Speculative Risks are those where there is a possibility of gain as well as loss. The element of gain is inherent or structured in such a situation. 2. Pure risks are generally insurable while the speculative ones are not. 3. The conceptual framework of the risk pooling can be applied to the pure risks, while in most of the cases of speculative risks where it is not possible. However, there may be some situation where the law of mathematical expectation might be useful. 4. Speculative risk carry some inherent advantages ti the......

Words: 1270 - Pages: 6

Premium Essay

Risk N Insurance

...International School of Business Management Risk and Insurance Management Assignment Submitted to: Parul Bhargava Associate professor Submitted by: Dipak kumar sah BBA, 4th sem Assignment Risk and insurance management 1. “Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.” Discuss & also describe the significance of insurance in Indian society. As per the statement “Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.” Insurance acts as a safety for the possible losses to be faced in near future. Insurance means safeguarding against a specific risk which is exposed to. Insurance is a form of risk management in which the insured transfers the cost of potential loss to another entity in exchange for monetary compensation known as premium. Insurance is a special type of contract between a insurance company and its clients in which the insurance company agrees that on the happening of certain events the insurance company will either make a certain payment to its client or meet the certain costs. As supporting the above statement, following are the significance of insurance in Indian society: 1. 2. 3. 4. 5. 6. 7. 8. Insurance provides......

Words: 2168 - Pages: 9

Premium Essay

Risk Management and Insurance

...CLASSES OF INSURANCE LIFE INSURANCE This is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual’s or individual’s death. It is the risk pooling plan and economic device through which the risk of premature death is transferred from the individual to a group In return the policy owner or policy payer agrees to pay a stipulated amount called a premium at regular intervals or in lump sums (so-called “paid up” insurance). A life insurance contract is intended to meet the needs of survivors or beneficiaries, when the investor dies. From the life insurance contract, the beneficiaries receive a sum of money that far exceeds the value of the premiums the investor had paid. The beneficiaries, of course, receive this benefit if the person insured dies during the contract period. The contract of life insurance is different from other types of insurance in the following respects. The event insurer against is an eventual certainty i.e. nobody lives forever. It is not the possibility of death that is insured against; rather, it’s the untimely death. The risk is not whether the insured person is going to die but when. The risk increases as the individual ages or grows older because chances of death are greater in later years than in initial years. There is no possibility of partial loss in life as in the case of property and liability insurance. Therefore, if a loss occurs under life...

Words: 1556 - Pages: 7

Premium Essay

Risk Management

...Chapter 1 – Risk What is risk Something that could go wrong or go right Concept based on perspective dependent on personal opinion Underwriter- one who looks and rates policys on whether the insurance comp is going to offer insurance. Risk for underwriter: that’s what they ensure or underwrite * Risk Management Uncertainty concerning loss The difference between expected losses and actual losses Possibility of variation of outcomes from given situation Chance or possibility of a loss Loss exposures: any condition or situation that presents a possibility of loss. Examples picture of store Product liability Slippery floors Case application Michael is a college student majoring in marketing, he owns the following A high mileage 2003 ford that has a current market value of $2500 Retain exposure loss Liability law suit- driving negligent Liability insurance Clothes tv cell phone and other personal prop value at $10,000 Fire caught in kitchen Protection of things- loss reduction, property insuranace Disposable contact value at $200 for a six mo. Supply Disapearanve of contact lense Retain that loss Gets jumped Avoidance Types of risk Pure risk House damaged by fire One family Plant explosion River overflows Speculative risk Invester purchases 100 shares of stock Slot machines Diversified One family Plant explosion Non diversified Department of homeland security alerts a large group River overflows Home buyers are effected by interest rates Risk Management- process, takes......

Words: 508 - Pages: 3

Premium Essay

Insurance Industry Risks

...Introduction The averaging out of independent risks in a large portfolio is called diversification. The principle of diversification is used routinely in the insurance industry. In this paper I will talk about two different types of home insurance and talk about the different risks associated with each. Discussion A portfolio is used to describe a collection of securities. In finance, the risk of an individual security differs from the risk of a portfolio composed of similar securities. In order to help us understand why, Chapter 10 in the book gave a great example on insurance companies. Let’s consider two types of home insurance: theft insurance and earthquake insurance. Lets also suppose that the risk of these two hazards is similar for a given home in a given area. Based on this information we would know that the risks of the individual policies are similar, however, the risks of the portfolios might be drastically different. For example, if the chance of theft in a given home is 1%, the insurance company would expect about 1% of the 100,000 homes in the area to experience a robbery. Thus the number of claims would be around 1,000 per year. If the insurance company holds reserves sufficient to cover roughly 1,000 claims, it will have enough to meet its obligations on its theft insurance policies. The portfolio for the earthquake insurance is a little riskier. For example, if in a given area, the risk of an earthquake is 1%, the risk of having an earthquake so......

Words: 1091 - Pages: 5

Premium Essay

Insurance, Risk and Market Associations

...Insurance, Risk and Market Associations 2010 Contents Introduction 3 Insurance 3 General Introduction 3 The principles of Insurance: 4 Task 1 The Irish Insurance Federation (IIF) 4 About the Irish Insurance Industry (Market) 5 The Chartered Insurance Institute (CII) and Irish Insurance Federation (IIF) 6 The Dublin International Financial Services Centre (DIFSC) 7 The Irish Brokers Association (IBA) 8 The Financial Regulator 8 Task 2 Graphs 10 Shop lifting 10 Burglary 11 Storm and High winds 11 Act of God 12 Flood 12 Fire 13 Suggested changes to reduce the theft risk 14 Conclusion 14 Bibliography 15 Introduction Insurance Insurance plays a very important role in today’s economy. Insurance is designed to protect the financial well-being of every individual and business. Without insurance we couldn’t drive cars, own our homes, run our business-because of the possible risks. General Introduction Insurance is a risk transfer mechanism which in return for a fee (‘premium’) will insure individuals or business against the risk specified. Aim of insurance is to compensate (‘indemnify’) the loss individuals or business may suffer through the occurrence of an unexpected incident, the loss that either may or may not happen. ‘Modern insurance low’ author John Birds, wrote that the beginning of insurance was developed by a commercial world in 14th century. The origins of the modern insurance contract was......

Words: 2168 - Pages: 9

Premium Essay

Risk Management

...Risk Management Students Name Course Tutor Date Philosophy/Policy Statement Risk management is a process that involves risk assessment and a mitigation strategy for the risks. This means that identification of potential risk and evaluation of the impact of the risk is necessary. This is what is called risk assessment. A mitigation strategy is a plan that has designed and put in place to minimize the impact of the potential risk events or the adverse effects of a risk on a project. Risks in a project are unpredictable. Some are yet to happen, and some will not occur. This means that one has to get prepared to deal with any risks. The underlying philosophy of handling risk is avoiding, mitigating transferring and accepting. Avoiding means that if prevention of the happenings of the risk is possible, then that would be the best option. If it cannot be prevented or avoided, taking action so that the risk will do little harm to a project would be the other option known as mitigation. The other effective way is to pay another party to accept it. This is called transfer and are such as insurance. Lastly, if the risk cannot be solved by transfer, avoidance or mitigation then one has to accept it. This means you have to face the risk although have other alternatives when this happens. Needs Assessment Needs assessment in risk management is an essential process for any company. This is an important tool that helps in identifying the lapses in various areas of risk......

Words: 2823 - Pages: 12

Premium Essay

Risk Management

...Chapter 2 Objective of Risk Management I. Multiple Choice 1. The fundamental objective of risk management is: a. diversification b. minimize the cost of risk c. hedging d. loss control Answer: b Type: K 2. If unexpected increases in losses from price risk are not offset by cash inflows from insurance contracts, hedging arrangements or other contractual risk transfers, they will result in: a. an increased stock price b. a reduced stock price c. bankruptcy d. increased diversification Answer: b Type: K 3. Johnson Incorporated, located in California, had a $1 million uninsured loss due to an earthquake in 1997. What impact is this likely to have on the firm’s value? a. It will have no impact. b. The firm value will increase by $1 million. c. The firm value will decrease by $1 million. d. The firm value will probably decrease, but the amount of decline will depend on other factors such as the firm’s level of diversification of risk. Answer: d Type: A 4. The cost of risk may include all of the following except: a. the cost of insurance. b. the cost of raw materials. c. the cost of increased precautions to control losses. d. the cost of investments in information to reduce risk. Answer: b Type: A 5. Maximizing the value of the firm is the same thing as minimizing the cost of risk if: a. the managers are socially responsible. b. the cost of risk is defined to include all risk-related costs from the perspective......

Words: 1603 - Pages: 7

Premium Essay

Risk Management

...What is Risk? A. Uncertainty Concept—risk traditionally has been defined as uncertainty B. Objective Risk 1. Defined as the relative variation of actual loss from expected loss 2. Declines as the number of exposure units increases 3. Is measurable by using the standard deviation or coefficient of variation C. Subjective Risk 1. Defined as uncertainty based on one’s mental condition or state of mind 2. Difficult to measure II. Chance of Loss A. Objective Probability 1. A priori—by logical deduction such as in games of chance 2. Empirically—by induction, through analysis of data 2 Rejda • Principles of Risk Management and Insurance, Tenth Edition B. Subjective Probability—a personal estimate of the chance of loss. It need not coincide with objective probability and is influenced by a variety of factors including age, sex, intelligence, education, and personality. C. Chance of Loss Distinguished from Risk—although chance of loss may be the same for two groups, the relative variation of actual loss from expected loss may be quite different. III. Peril and Hazard A. Peril—defined as the cause of loss B. Hazard 1. Physical hazard—physical condition that increases the chance of loss. Examples are icy streets, poorly designed intersections, and dimly lit stairways. 2. Moral hazard—dishonesty or characteristics of an individual that increase the chance of loss 3. Morale hazard—carelessness or indifference to a loss because of the existence of insurance 4.......

Words: 2119 - Pages: 9