Internship Report On Askari Insurance 2z5lr

My overall experience of preparing this report was a knowledgeable journey. I learn a lot about the functions of Askari General Insurance Company. Apart from this, by actually conducting this report, I also learnt practical application of what I have been studying in overall M.B.A. For completing this project I required the annual reports (3 years) of not only Askari General Insurance company, but also of some other insurance companies which are benchmark at this time in the industry in order to estimate the industrial profile, business processes and SWOT analysis. I got my required data from websites of insurance companies and from newspapers. While conducting this report I faced some problems in getting the data as at websites data is not managed very well. The knowledge of what I have studied in MBA also came in handy. Once every thing was found out it got very interesting.

“I dedicate this work of mine to my Teachers, My Parents and to all My Friends, who truly help and guide me in completing this project. “

I am grateful to Allah almighty, for enabling me to fulfill this tiring, but interesting job for the completion of my report.

The long and arduous task of developing this report was made easier by the help and guidance of my teachers Dr.Khwaja Amjad Saeed, Mr. Irshad and as well as Mr. Fida Hussain Bukhari.The whole practice of collecting material for the report compiling and composing was enjoyable.

I would not be going justice in presenting this report without mentioning the people around us who have been inextricably related with the completion of this report I extend my deep gratitude and heartiest thanks to my teachers and Coordinator for preparing this report.

Internship experience is very important and helpful before anyone goes looking for a job. Employers want people who have experience. Internship gives students the opportunity to grow, academically and personally. When anyone initially starts out he is going to be doing the menial repetitive task that every new person had to do. However this is not necessarily negative as it teaches the person responsibility at the smallest level. Askari Insurance Company has 19 branches in Pakistan in 15 Cities and main objective is to provide its customers with safe, secure and reliable service through wide range of products. The report covers all the product information provided by the Askari insurance company: Profile of Askari insurance Company, in this regard I tried to given the information of Askari insurance company. . In the profile of the company I am trying to giving all the possible available information of the Askari Insurance Company. Company business process, in this section I tried to elaborate all the functions that are performed by each department of Askari Insurance company and as well as discuss about the key products of the Askari insurance Company that are highly involved in the progress of company. SWOT analysis of company, in the section, I humbly stated the strength and weakness and as well as opportunity and threats of the organization. It very difficult to pin out weakness of the AGICO but I tried our level best in this regard. Problems and recommendations, in this portion of the report I discuss about some problems and as well as give some suggestions and recommendations to over come these problems. It might be helpful for the AGICO. I believe that this report will provide some very important information regarding my departments (Claim department, Underwriting department, Marketing department and s). I also describe my experiences in these departments and I am sure it would be helpful for all. Underwriting and other is claim department. That’s why, Branch Manager to be found having more consideration on these department and personally to look after very carefully. The SWOT analysis is covered in the report to show the standing of the company in the recent market.

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Adamjee Ins. American Life Asia Ins. Askari General Ins. Atlas Ins. Beema Pakistan Business Ins. Central Ins. Century Ins. Cres. Star Ins. EFU General Ins. EFU Life Assurance East West Ins. Habib Insurance IGI Insurance

16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Ittefaq Gen. Metro Life Assurance New Jubilee Life New Jubilee Ins. PICIC Ins. Pak Gen. Ins. Pak Reinsurance Premier Ins. Progressive Ins. Reliance Ins. Shaheen Ins. Silver Star Ins. Union Ins. United Ins. Universal Ins.

Introduction of Askari General Insurance Company

Askari general insurance co. ltd (Agico), established in October 1995, was sponsored by Army Welfare Trust (AWT), Askari Commercial Bank ltd (ACBL) and Askari Leasing Ltd (ALL). It is a public limited company, listed on all three Stock Exchanges of Pakistan i.e. Karachi, Lahore and Islamabad. The Company provides general insurance products and services to all sectors of the market. The company has earned itself a reputable place amongst top players of insurance industry. Agico's financial strength and rapid growth has been achieved through its policy of retaining and reinvesting a large part of the profit to strengthen the Paid Up Capital and Reserves. The company's financial position provides security to the clients and ensures progressive return to the stakeholders. Agico transacts all classes of non-life insurance business. It holds a strong position in Health Insurance and is the leader in it's expansion. The company has a large base of prestigious Pakistani and multinational clients being served through a network of 16 Branches spread all over the country.

Human resource is the main stay of the

company and is imposing for its highly qualified and entrusted staff. The company is committed to create insurance awareness and promote insurance culture through its highly motivated and dedicated team of professionals.

VISION

The Vision of Askari general insurance company is to be amongst the leading insurance companies of the country with the clear perception of upholding the principles of corporate governance and making Agico a profitable and growth oriented insurance company while creating insurance awareness and culture

MISSION

The Mission of Askari insurance Company is to become a leading company by providing client friendly services through highly motivated team of dedicated professionals and ensuring progressive return to the stakeholders

PHILOSOPHY 1.

Excellence in Service

2.

Quality Performance

3.

Product Innovations

 Agico believes in the phrase “customer comes first”. AGICO objective is to please their customers by fulfilling the insurance needs as best as possible. They believe in placing the client at the center of business and all of the products and services.  Service excellence is one of the objectives of AGICO.  AGICO strives continually on the development of new areas of activities to distinguish itself in the market place along with traditional insurance Companies activities.  AGICO objective is the complete automation and computerization of all of its insurance activities.  AGICO Training and Development program of its employees is aimed at developing skills of its employees. It makes positive contribution to the service culture of the insurance system as a whole.

Under the strong leadership and management of Lt.General(retd) Imtiaz Hussain Askari Insurance company has achieved success in a short period of time. During the last few years it has assumed a brand new identity plied with a spurred vision. The board and management of the Askari insurance company have implemented strategies and policies to carve a distinct position for the Askari Insurance Company in the

market place. The Askari Group, a paragon of strength has played a pivotal role in helping the Insurance Company.

Chairman Lt. Gen. (Retd) Imtiaz Hussain

Directors Maj.Gen.(Retd.)Saeed Ahmad Khan Brig. (Retd) Javed Qayum Mr.Abdul Waheed Brig. (Retd).Mushtaq Ahmed Malik Syed Suhail Ahmed Rizvi Mr. Abdul Hai Mahmood Bhaimia

Audit Committee Mr. Abdul Waheed Chairman Brig. (Retd) Mushtaq Ahmad Malik Member Mr. Syed Suhail Ahmed Rizvi Member

Auditors KPMG Taseer Hadi & Co. Chartered ants

Legal Advisor Mr. Farrukh Karim Qureshi

Bankers Askari Commercial Bank Limited Arif Habib Bank Ltd.

Habib Bank Ltd. Standard Chartered Bank Ltd. Soneri Bank Ltd.

Registrar and Share Transfer Office THK Associates (Private) Limited, Ground Floor, State Life Building-3 Dr.Ziauddin Ahmed Road, Karachi Tel: 111-000-322 Fax: 021 - 5655595

ed Office/Head Office 4th Floor, AWT Plaza, The Mall, Rawalpindi, Pakistan Tel: 051 - 9272425 - 7 Fax: 051 - 9272424 Web Site: www.agico.com.pk e-mail: [email protected]

President & Chief Executive Mr. Mohammad Hussain Hirji

Executive Vice Presidents (Marketing) Syed Hassan Nadeem Rana Shahbaz Ahmed

Senior Vice Presidents Mr. Muhammad Afzal (H.O) Engr. Ehtesham Malik (Engineering) Sheikh Abdul Qayyum (Claims) Mr. Muhammad Iqbal (Reinsurance) Mr. Waseemullah (Company Secretary/CFO) Mr.Najam Irshad

Senior Vice Presidents (Marketing) Ch. Shams-ul-Haq Mr. Shah Saud Mirza Mr. Sarfraz Ahmed Tarrar

Vice Presidents Maj. (Retd) Muhammad Ajmal Khan Mr. Ali Munem Shamsi Mr. Sohail Khalid Mr.Jamil Ahmed (C.A)

Vice Presidents (Marketing) Mr. Mubashir-ul-Hassan Mr. Tahir-ul-Haq Sh.Muhammad Hanif Sh.Abdul Wahab

Assistant Vice Presidents Mr. Ghulam Ashgar Mr. Waqas Ahmed

Mr. Sohail Younas

Assistant Vice Presidents (Marketing) Mr.Ikram Zai Mr.Moeenuddin

Managers Mr. Tazeem Hussain Mr. Gulzar Hussain Shah Syed.Imran Abid (I.A) Mr.Noor Afsar Mr.Gulfraz Anis Mr. Muhammad Ali Soomro Mr.Qamar Ikram Sheikh Mr.Shahid Hussain Mrs.Tallat Raza Mrs.Samina Khan Mr.Shahid Hussain Mr.Tahir Mahmood Mr.Faisal Ejaz Mr.Taqiuddin

Islamabad 11 West, Jinnah Avenue, Blue Area, Islamabad. Tel: (051)2279565, 2270471-2, Fax :( 051)2279566 Email: [email protected]

Rawalpindi National Business Center, Murree Road, Rawalpindi. Tel: (051)9290489, 9290499 Fax: (051)9290479 Email: [email protected]

Jhelum 1st Floor, Soldier Plaza, Civil Lines, Jhelum. Tel: (0544)9270339 Fax: (0544)9270374 Email:[email protected]

Sialkot 1st Floor, Oberoi Cooperative Building, Paris Road, Sialkot. Tel: (052)4582381 Fax :( 052)4582382 Email:[email protected]

Gujranwala 1st floor, Al-Azahar Plaza opp.Iqbal high school Ghala Mandi,G.T Road,Gujranwala. Tel: (0431)3856324, 3734326

Fax :( 0431)3856325 Email:[email protected]

Lahore 3rd Floor, Al Malik Plaza, 19 Davis Road, Lahore. Tel: (042)6308633-4 Fax: (042)6308635 Email:[email protected]

Faisalabad 2nd Floor, Platinium Centre, Kotwali Road, Faisalabad. Tel: (041)645802-4 Fax :( 041)645801 Email: [email protected]

Multan 2nd Floor, Jalil center, Abdali Road, Multan. Tel: (061)547842 Fax :( 061)547862 Email: [email protected]

Hyderabad

1st Floor, Gul Centre, Thandi Sarark, Hyderabad Tel: (0222)729689 Fax :( 0222)783976 Email:[email protected]

Karachi (021) 3rd floor ,AWT Plaza I.I Chundrigar Road, Karachi. Ph:2273513-5,Fax:2214332 e-mail: [email protected]

Abbotabad (0992) Room -10,Silk Plaza, Mansehra Road , Abbbotabad. Ph: 342439 e-mail : [email protected]

Web sites 

www.Agico.com.pk



www.google.com



www.efuinsurance.com

News papers  INSURANCE JOURNAL 

www.dawn.com



www.nation.com.pk

Books  Principals of Insurance(ACII)  Claim Management(ACII)  Marketing(ACII)  Motor Insurance(ACII)

PERSONNEL HIERARCHY IN AGICO BGP BRANCH

Branch Manager:

NAME MR. TAHIR AHMED DESIGNATION BRANCH MANAGER OF LHR QUALIFICATION M.A Economics, MBA. EXPERIENCE 10 YEARS ASSIGNMENTS TO LOOK AFTER THE BRANCH OVERALL PROGRESS AND TO MEET THE ASG SET TARGETS.

Claim Department:

NAME DESIGNATION QUALIFICATION EXPERIENCE ASSIGNMENTS

Mr. Ramzan CLAIM MANAGER M.B.A 3YEARS TO HANDLE THE CLAIM DEPARTMENT AND IDENTIFY THE VALIDITY OF LARGE CLAIMS

DEPARTMENT:

NAME DESIGNATION QUALIFICATION EXPERIENCE ASSIGNMENTS

MR. RAZA Officer M.B.A. 4 YEAR MANAGE BRANCH S

UNDERWRITING DEPARTMENT:

NAME DESIGNATION QUALIFICATION EXPERIENCE ASSIGNMENTS

MR.Nasir UNDERWRITER M.B.A 4 YEAR ISSUE INSURANCE POLICIES

MARKETING DEPARTMENT: Marketing Manager:

NAME DESIGNATION QUALIFICATION EXPERIENCE ASSIGNMENTS

MR. AZHAR MURAD OPERATION OFFICER M.COM 35 Years HANDLE THE MARKETING DEPARTMENT AND

ACHIEE SET TARGET.

Vice Marketing Manager:

NAME DESIGNATION QUALIFICATION EXPERIENCE ASSIGNMENTS

MR. FAROZ ASSISTANT MARKETING MANAGER M.B.A 8 Years TO ACHIEVE SET TARGET

ASKARI GENERAL INSURANCE COMPANY DEVIS ROAD LHR:

TRAINING PROGRAM: During internship-training program of Hailey Collage of Banking and Finance I worked in Askari Insurance Company for 6 weeks. Fortunately

I had the advantage of working in the very friendly atmosphere branch of Askari Insurance Company. Here I had the chance to learn a great deal. During the training I worked in different departments of the Askari insurance company. I was able to get a complete idea of the working of a insurance company. It was a very knowledgeable experience. In the following pages I have explained the working of various departments in which I worked during the period of training. I am very grateful to the officers of Askari Insurance Company who helped me during the training in understanding various aspects of insurance company as well as after training in the preparation of Internship Report.

DEPARTMENTS (1)

Underwriting Department

(2)

s Department

(3)

Claim Department

(4)

Marketing Department

In the early days of marine insurance, the details of a ship or cargo to be insured would be described on a slip. This slip would be taken to Lloyd's and the person who was to carry the risk would read the details and then sign the slip under the details of the risk. In this way the person carrying the risk became known as the underwriter. The underwriting process is far more complicated nowadays but the term still applies. When we looked at the nature of insurance we take it as a common pool. The contributions of many people were made to the pool and the losses of the few were met from it. In essence the task of the underwriter is to manage this pool as effectively and profitably as he can. Thinking of the role of the underwriter in this way we could say that he has to:

Assess the risk which people bring to the pool; Decide whether or not to accept the risk or how much to accept; Determine the conditions and scope of cover to be offered; Calculate a suitable

HAZARD

The first task of the underwriter is to assess the risk which person brings to the common pool. There are various definitions of risk and a number of different associated . One of the we examined was hazard. We differentiated hazard from peril by saying that peril was the event giving rise to the loss itself, such as collision, fire, theft. Hazard was the factor which might after the frequency or severity of the peril. Underwriter has the task of assessing the hazard which is associated with the various perils brought to the common pool. There are two aspects of hazard, physical and moral with which the underwriter is concerned. THE UNDERWRITING PROCESS The actual process by which risks are underwritten will vary from one class of business to another and will also depend on an insurer’s general approach. Underwriting in a general sense in relation to personal insurances, life assurance and commercial insurances.

PERSONAL INSURANCE The underwriting of personal insurances is relatively straightforward. The main source of information abut a risk will come from the proposal form and if there is anything else which an individual underwriter may want, he would write to the proposer. A large volume of proposal forms for various classes of personal insurance will be dealt with by branch offices of insures. Much of the work will be mechanical in nature and the vast bulk will be processed with little difficultly In many cases the underwriting is delegated to some other person, quite outside the insurance company. This is the case for example in travel insurance where the policy is sold by a travel agent or airline. A proposal form is completed by the proposer and the policy issued almost immediately from a pad of policies. Possibly with an upper

monetary limit on the sum insured. Underwriting in these cases is almost a matter of making sure that a completely undesirable proposer is not allowed cover. There will be little discrimination among those cases which are accepted and he brooked or other agent will have little or no flexibility in pricing.

COMMERCIAL INSURANCE The underwriting of commercial business insurances is a much more complicated and involved task. Commercial insurance rang reform small shops and factories to large multinational corporations with operations in many countries throughout the world. The degree of complexity of the underwriting required will obviously vary with sheer size of the risk but certain basic principles are still recognizable.

The essence of the task is that the underwriter has to evaluate the hazard associated with the risk which is being proposed. In small cases he may be able to do this from reading a proposal form and corresponding with the proposer. It may be that a local inspector asked to call and see the shop or factory for himself. In large cases this is simply impossible. For one thing the details of a risk could not be confined to a proposal from. There is just too much information to condense on to a form no matter how large the form may be. This is where the broker may help. As we mentioned earlier, the broker in these large cases will be in a position to prepare the case for the underwriter. This may mean site inspections by the broker and the preparation of the plans and reports on the relevant aspects of the risk. This documentation, which may be extremely extensive, is then

ed to the underwriter and negotiation can commerce on the , conditions, cover and price.

A RISK SURVEYS Even where a broker is involved (and certainly when there is no broker). The underwriter will involve a surveyor. This risk surveyor is the person who acts as The eyes and ears of the underwriter, many companies employ specialists surveyors in the different areas of risk such as fire, security, liability, business interruption and so on. The surveyor will eventually prepare a report for the underwriter and in the case of many property risks will also draw plan. The report will cover a number of features, including. A full description of the risk. This may include the plan of the premises in the case of property risk, the process being carried on at the premises, details of the insured etc. An assessment of the level of risk. This will take into all the relevant hazard factors, both moral and physical, and provide the underwriter with some idea of the degree of risk which he is being asked to accept. The surveyor will also be able to comment on surrounding property as in the case of fire insurance, for example, this may have an impact on the level of risk. A measure of maximum probable loss (MPL). This MPL, or estimated maximum loss (EML) as is known by some, is the maximum that the surveyor believes will be the subject of a loss.

This MPL calculation takes no of any good features which may be present. The underwriter must then consider the impact of good features and may reduce the MPL. In a fire risk the underwriter may take of fire lighting apparatus of various kinds such as automatic sprinkles. One point the surveyor would have to is that MPL, he has just calculated is only for fire damage. The building could, for example, be in the flight path for a major airport and run the risk of being destroyed by aircraft. Dividing walls would be little calculating MPLs is to give the underwriter an idea of the maximum which is likely to be lost. Recommendations on loss prevention. The surveyor will also make known to the insured what steps should be taken to protect the risk. In a

few

cases

these

recommendations

will

be

in

the

form

of

requirements which the insured must implement if cover is to be granted. The surveyor’s view on the adequacy of the insurance being requested. In all of this the responsibility for ensuring that the cover is adequate, rests with the insured. He may seek advice from a broker or other expert but at the end of the day he will have to satisfy himself that the insurance are adequate. Adequacy, in the case of many classes of insurance will mean the sum insured. This will be true for many classes of property insurance. In the case of liability insurance there is of course no sum insured, but a limit of indemnity. Adequacy in thee cases will mean a limit of indemnity large enough to cater for the expected claims. The adequacy of cover is an extremely important issue and the underwriter will want to ensure, as far as is possible. That the insured is not under insuring the risk.

Assuming that the risk is acceptable in all matters relating to the level of hazard, the decision as to how much of a risk can be accepted is, in part, dependent on the financial capacity of the insurer. The insurer may have some limit on how much of a particular type of risk it wants to accept in any year. Questions relating to the financial capacity of the insurer, lead us into the area of reinsurance.

S Tasks of the underwriter as: Assess a risk which people bring to the pool; Decide whether or not to accept the risk or how much to accept; Determine the ; conditions and scope of calculate a suitable . So far we have looked at the role of the underwriter, the underwriter process itself and the part played by reinsurance. These have examined, in their different ways, the way in which risks are accepted insurers and the financial steps which insurers take to protect themselves. Insurance Companies have two final aspects the insurance transaction to examine. The first, which business of pricing and praying for the insurance service and the second is the making of claims. The last task of the underwriter was to calculate a suitable . The which an insured pays represents that insured’s contribution to the common pool. This contribution must be fair and must reflect the degree of hazard which that insured brings to the pool. In other words the must be sufficient to:

Cover Expected claims The insurer is in a position to estimate the level of claims which it expects. It is not possible to say exactly how much is to be paid out in

claims but because of the numbers involved the insurer can make a reasonably accurate assessment of the likely loss costs. At the very minimum the must be sufficient to meet these expected claims.

Create an estimate for outstanding claims Not all claims will be settled during the year for which the has been paid and hence the must take into those claims still to be settled at the end of the year. This is particularly true in the case of claims involving personal injury. They can take several years to settle and the insurer must bear them in mind when calculating the .

Provide a reserve The insurer must also take into the fact that there can be contingencies, beyond their control, which may involve a liability to meet claims at some time in the future. Insurers do this by making reserves.

Meet all expenses The insurer has a number of operational expenses to meet in the running of the business. These include: Salaries to staff; Office costs of all forms’ Advertising; Commission. The collected from each insured must be sufficient in aggregate to cover these costs of operating.

Provide for profit

Finally, the insurer must ensure that there is provision for a reasonable profit. The majority of insurers is answerable to shareholders and must provide

a

reasonable

return

on

the

investment

which

these

shareholders have made in the company. In the case of mutual companies, the will still be looking for a reasonable surplus being made in order to meet the objectives of the mutual. Arriving at the , however, is not simply a matter of calculating the correct by a mathematical formula. A number of important commercial considerations must also be borne in mind. These will include:

Inflation The insurer must be aware of the changing value of money. Claims will be met tomorrow, out of received today. The implication of this is that the cost of settling a claim may rise, not due to any increase in the magnitude of the claim itself, but simply due to the all insurer can not ignore in their calculations.

Interest rates We have already seen that insurers are major investors of funds. These funds generate substantial investment income upon which insurers depend. Variability in interest rates has also to be taken into in calculations.

Exchange rates We have also seen that a substantial volume of income is derived from outside of the United Kingdom. Whenever there is movement of money across national borders, there is the added problem of exchange rate risk. The insurer has to take of this

risk and the cost of managing it has to recover through the which insured’s pay.

UNDERWRITING PERFORMANCE Rupees in million 2009

2010 Fire & Property Damage Gross Net Revenue Net Claims Underwriting profit

295 67 12 17

248 49 18 19

55 50 12 38

62 39 8

23

555 504 290 55

427 420 242 63

355 300 286 (38)

290 275 249 (42)

90 25

81 22

Marine, Aviation & Transport Gross Net Revenue Net Claims Underwriting profit Motor Gross Net Revenue Net Claims Underwriting profit Accident and Health Gross Net Revenue Net Claims Underwriting profit Miscellaneous and Treaty Gross Net Revenue

Net Claims Underwriting profit

8 18

Required

Documents:

Documents required under taking insurance are as follows:

Documents and information for Motor insurance: 1.

Original CNIC,

2.

Details of vehicle,

3.

Sum insured,

4.

Registration Book,

5.

Driving license,

5 15

Documents and information for Marine insurance: 1. Original CNIC, 2. L/C Number 3. Performa invoice 4. Sum Insured 5. Vessel Name 6. Port of shipment and destination

Documents and information for Fire insurance: 1. Original CNIC of Insured, 2. Type of Risk, 3. Construction class, 4. Sum insured, 5. Subject Matter of insurance,

Documents and information for Travel insurance: 1. Original CNIC, 2. Area of visit 3. Sum insured 4. Duration for insurance 5. No of persons

Documents and information for Health insurance: 1.

Original CNIC of insured

2.

Current health certificate

3.

Type of cover required

4.

On monthly or weakly basis

I worked in UNDERWRITING DEPARTMENT for 12 days. During this short period l learnt how to asses the risk and whether to accept the risk or not and if accepted than on what and conditions and calculate suitable for that risk. The is based on many factors like how if the risk is more hazardous than high rate of is charged similarly if the risk is less hazardous than low is charged. The that is charge for a risk must be adequate for that risk and meet all the expense that spent on that risk like istrative, commission, advertising and other general expenses etc. Different software is used in agico for the calculation of . I learnt how to operate that software to calculate the . In this way I learnt how to is calculated and what types of risks covered in the policy and issue the insurance cover note. I got this information from Mr. Nasir was very co-operative and helpful. He taught everything related to underwriting in a very friendly atmosphere. They were appointed in this insurance

company from few years and they were doing a very good job. It was a very nice experience to in this department.

It is the one of important department of an insurance company. One can have a complete view of the functions and monthly expenses of insurance company from the s. The functions of s department include managing controlling and recording the inflow and outflow of cash from the daily basis to monthly and annual basis. It is very difficult job to record all the expenditure of the company. This increase the importance of department in the company. The profitability of a company can be judged through the analysis of its s record. Major work of is done in company head office in Rawalpindi.

One can have a complete picture of the different activities and expenses by sitting in “S”. From this perspective it was a knowledgeable experience for me. On the very first day Mr. Raza who is designated as officer. He gave me an overall view of the various functions performed by the department. I worked for about 6 days in s. In this short period I learnt a lot not only about the “s” but also various other activities of the Insurance company. Mr. Raza who is the in charge of the s Department was very helpful and co-operative. I learnt about various functions of the s. With the help of Mr. RAZA I was able to manage petty cash and other expenses of the branch. He was kind enough to take out time from his busy schedule to teach me how to maintain records relating to day to day branch expenditures. The main work of s is done company head office. He was responsible for “Manage Branch Expenses and Staff Salaries” which is a tough job and I helped him along with other internees in doing this task during the period of my internship. Working in this department was a very nice experience.

In a real sense the claim is the tangible result of insuring. We have talked quite a lot about peace of mind, security, freedom from worry

and so on but at the end of day the value of the cover will be judged, for most people, by the way which a claim is handled. The actual procedure for handling claims varies according to matter such as the type of cover, the amount of the claim and whether it is a personal or commercial claim insured.

CLAIMS NOTIFICATION The first and most important point to make is that the notification of a claim is the responsibility of the insured. We will see later that the insured also has certain other duties but at the outset he has the responsibility of intimating the claim. We saw in chapter six that one of the claim. We saw in chapter six that one of the conditions on policies relates to the notification of claims. The insurer will want speedy notification of the claim and will often lay down time limits within which a claim should be intimated.

The means by which claims are normally intimated is the claim form an example of a form is shown in Appendix 1 at the end of this chapter. This is for a business premises policy and you can see the kind of questions which are asked. While the claim form is the main means by which insurers receive notification of claims, it is not always used. In many cases, including large losses or losses involving a great deal of details, the insurers would appoint a loss adjuster and we will look at the role of the adjuster later.

CLAIM HANDLING

Small, personal claims are often dealt with by someone, other than the insurance company. Brokers and others can have delegated authority to issue simple personal policies. In certain cases these brokers may also have authority to handle claims. There may be a limit on the value of claims which can be dealt with in this way but the process is speedy and the claimant deals with the person or organization issuing the cover in the first place. The majority of claims, however, will be dealt with by the claims department of the insurer. The onus is on the insured to prove that he has suffered a loss by a peril which is insured by the policy, and this will have been done by the completion of a claim form is most cases. The insured must also prove the value of the amount of the loss in all cases other than those involving life assurance, personal accident or liability. The insured cannot simply intimate a claim for a lost or damage item without proving the value of the item. This proof could take the form of a purchase receipt, a repair or valuation. The point is that it is not or the insurer to prove the value of the loss. The insurer has its own areas of responsibility, it has to ensure that: Cover was in force at the time of the loss; The insured is the correct insured; The peril is covered by the policy; The insured has taken reasonable steps to minimise the loss; Conditions have all been complied with; No exceptions are appropriate The value of the loss is reasonable. These steps can involve a great deal of work and the claims departments of companies are often among the busiest. However, there is a limit to the number of staff which even the largest companies could afford to have in house to deal with claims. Not only

would the cost be huge but the level of expertise required would be costly in of recruitment and training.

LOSS ADJUSTERS The alternative is to retain experts. Such experts are chartered loss adjusters. Not only are they used for large or detailed claims but many insurance companies would retain the services of a loss adjuster to deal with the majority of their property losses. The loss adjuster is an expert in processing claims from start to finish. They are normally involved at the very early stages of a claim and will see it through to the conclusion. This will involve ensuring that all the interests of the insurer are preserved, in checking that the cover was in force and was adequate eat the time of the loss. The adjuster will also act to minimize the extent of the loss and is in a position to use his considerable experience to bring about a swift settlement of the claim. The loss adjusters would

go to work, helping the insured to recover

his position after this loss and a final report would follow which would give details of what the actual loss amounted to.

CLAIMS SETTLEMENT The final stage in the claims procedure is the actual monetary settlement. The claim has been notified, all parties have carried out their respective duties and all that remains is for the claim to be settled. The actual settlement, or the amount payable, depends upon a

number of factors including: the nature of the cover; the adequacy of the cover and the application of any conditions which Limit the amount payable. It is possibly easier to decide on the amount payable under a life assurance policy than other forms of policy. The life assurance policy normally has a fixed sum assured and both the assured and the assurer understand exactly what is to be paid and under what circumstances it will be paid. There may, of course, be complications in specific circumstances but in the main the amount payable is stated on the policy and is not the subject of discussion or negotiation at the time of a claim. What we might say is that in these cases the amount payable in the even of a claim has been determined prior to the claim and has been stated on the policy. Contrast this to the case of a fire claim at a factory. The policy of insurance does have a sum insured but this is only the limit of the liability of the insurer, not the amount which they have agreed to pay in the event of a claim. The eventual cost of the claim will depend on the extent of loss or damage and on the nature of the Cover afforded by the policy. In most property policies there are two kinds of cover, indemnity or reinstatement. These are with which those of you who go on to study general insurances will become very familiar. In brief, indemnity is one of the basic doctrines of insurance which says that an insured is to be placed in the same financial position after a loss as he enjoyed before the loss. As a value can not be placed on a person’s life or limbs, we can say that life assurance and personal accident policies are not assurance and personal accident policies are not contracts of indemnity. Property and liability policies however, are.

Take the case of a fire at a factory, which present obvious problems in ascertaining which value of the loss. A machine bought five years ago for 50,000, which has been used for all of these five year is clearly not Worth 50,000 today and this would not be value of the loss. Trying to place the insured in the same financial position after the machine has been damaged, as the enjoyed before may damage will be difficult. Where the machine is completely destroyed the measure of indemnity would be the replacement cost less an amount for wear and tear. In the case of partial damage, indemnity would be the repair cost less wear and tear. Let us assume that the machine has a life expectancy of ten years. It has expended half its life expectancy and this is a measure of the wear and tear. The cost of replacing the machine today is 90,000. Indemnity would then behalf of the cost of replacement 45,000 and this would have to be the sum insured. Notice that this figure depends on the level of wear and tear and the replacement cost. As replacement costs will rise each year it is likely that the final sum insured will have to rise.

You can see how this could cause a great deal of work, and potentially, a few problems for both the insured and the insurer. Reinstatement, on the other hand, provides the insured with the cost of reinstatement. This is a form of new for old cover and many household insurers use that phrase in their marketing. Offering reinstatement avoid much of the difficulty in ascertaining the value of a loss under an indemnity contract. In the case of the machine we used in the contract. In the case of the machine we used in the earlier example, the insured would have to fix sum insured at the cost of reinstatement. We know this to be 90,000 but the loss may not happen until the last day of the insurance year. What the insured needs to calculate is the cost of reinstatement, at the time of reinstatement,

and this may be higher than the cost of replacing the machine today. It may even be that there is a time delay in ordering new machines of this type. All of these factors have to be taken into . With liability claims is a little easier to decide on indemnity. A liability policy provides indemnity to the insured in respect of his legal liability to pay damages.

Diagrammatically, I would explain to it in the following manner:

After verification of all documents, a disbursement voucher is send to head office and claim is paid.

Intimation of claim Intimation normally is made through the telephone call or client can directly inform the company.

In the next step, the required documents are collected by mutual cooperation i.e. insurer & insured

In this step the surveyor is appointed to access the actual loss.

MEAN OF INTIMATION:

Most of claims are intimated through the phone call or it’ll also make through that the client directly came in the company and inform about the claim. When the claim is intimated by the insured, some important information are required from the insured person i.e. Date, name and address of the insured person, policy no, expiry date of the policy, endorsement no (if any), make of the vehicle, engine no, chassis no, nature of loss, name of a person with telephone number with whom the can be made for any further information and estimate of loss. After having the above information from the insured person, the further proceeding is carried on. You can observe the claim intimation form below:

Askari general insurance co. ltd. MOTOR CLAIM INTIMATION FORM BRANCH OFFICE – LAHORE Date:_____________________

ATTN: Miss Asma

Name & address of the insured___________________________________

____________________________________________________________

Policy No: MVP__________________________Date:________________

Endt. #:_____________________________________________________

Expiry Date:_____________Receipt No:___________Date:___________

Date of Expiry of previous policy, if any:__________________________

Date of intimation of loss to the branch office:______________________

Make of the vehicle:____________________Reg. No:_______________

Cause and nature of loss:_______________________________________

Place where survey is to be conducted:____________________________

person with phone No:__________________________________

Name of the surveyor appointed:_________________________________

No:__________________________________________________

Date:______________________Authorized signature:________________

After fulfillment of intimation form it is decided whether to conduct;

 Self survey.  Independent survey.

Self survey: If the estimate of loss or damage is below than Rs.10, 000, then survey will be conducted by the staff member of ‘Askari general insurance Company’. Mostly, self survey is conducted in order to save the expenses of the company.

Independent survey: Normal practice to access the loss is carried on through the appointment of independent surveyor of any surveyor company. These surveyors are experienced in assessment of loss and assess the actual loss and try to minimize the loss in order to favors the insurance company. But they don’t do something unfair in assessment of loss. Surveyor will survey the vehicle at the spot of accident or at the workshop which are specified by the company.

Askari general insurance co. Ltd. SELF SURVEY REPORT Claim No.:

__________________

Int.Date:________________

Insured Name:____________________________________________ Policy No:

__________________ Expiry Date:_______________

PARTICULARS Make:

__________________ Sum Insured:_______________

Reg. No:

__________________ Model:_______H, P/CC:_______

SETTLEMENT Amount of labour

Rs.____________________

Cost of parts

Rs.____________________

Sub total

Rs.____________________

Less depreciation @ Rs.____________________ Net payable

Rs.

Cheque may please be issued in favour of ______________________

___________________________ Date & Signature of surveyor

I worked in Claim department for 12 days. During this time I realized the importance of this department. Reputation of the insurance company largely depends upon the efficiency of this department. Mr. Ramzan helped me a lot and gave me the above-stated information regarding claim department. With the guidance of Mr. Ramzan. I learned how to make a claim file. In claim department I learnt the whole procedure of claim process from claim intimation to claim settlement. He was very friendly and helped me in every possible way. He told me how to appoint surveyors to investigate the claim and send a complete file of claim. Than I got knowledge how to the information and documents according to various angles and after verification of documents and prices than issue the claim check.. By working with him the claim settlement Procedure became very clear. During work in claim department I got knowledge about various forms and their uses like policy form, claim intimation form, accicdent report form, survey form, satisfaction note, claim disbursement voucher, bank payment voucher etc. They have a busy routine. There is a heavy responsibility on their shoulders to handle the entire claim process. They took out time from there busy schedules to explain to me the working of department.

The role of marketing generally focuses on products and services, their prices, their promotion and the channels through which they are sold and distributed to people and organizations that need and want them. Essential part of marketing's role today is to match each organization's capabilities with the need of specific groups of customers in order to achieve the objectives of both parties. Insurers have a service to sell this most be marked in such a way as to attract consumers or potential consumers. Over the last couple of decades there has been a substantial increase in the level of publicity undertaken by insurers and brokers. Insurers, in particular, have embraced modern concepts in marketing and some of their ments are regarded as 'classics' in their own light. People may be familiar with the money television ments, for example, which appear regularly, promoting the products available from insurance companies. Advertising and the marketing of products is not limited to television. Insurers make substantial use of a whole range of techniques. Marketing plays a vital role in the transaction of insurance today. At some point, the potential consumer has to be provided with an idea of the product being offered, the television ments, bill-board, sports sponsorship etc. may all generate interest, but at some stage the proposer will want something to read which he can understand and which will indicate what the insurer can offer by way of protection. In the past it may b fair to say that

The insurer presented a rather austere image to potential consumers. There was a certain mystery about the product and the marketing message was not always Clear. Often the only printed publicity material which was available came in the shape of the proposal form. This is a generalization and of course there have always been insurers who have been excellent in their marketing.

Marketing

Department

of

AGICO: The marketing department of Askari insurance Company has a number of marketing professionals. They are all experts in their work. Mr.Azhar-A-Murad marketing manager and Mr.Feroz Qaiser assistant marketing manager of in Askari insurance Company are two main persons. Mr. Azhzr-A-Murad is one of the legends of insurance field. He has more than 35 years experience in marketing field. Personal relations are main source for getting and revenue for the AGICO. Every employee has their own relations and they bring business for the company with their references. They participate wholeheartedly to get the commission on revenues. AGICO provides high %age of commission on sum insured.

I worked in marketing department for 6 days. During this time I realized the importance of this department. Business of the insurance

company largely depends upon the efficiency and courteous behavior of this department. Mr. Azahr-A- Murad, who is the marketing manager and also in-charge of department, introduced me to the rest of the staff. All of them were very helpful and I learned about insurance marketing from them. Mr. Feroz Qaiser helped me a lot and gave me the information regarding Marketing. With the guidance of Mr. Azhar-A-Murad I learnt how to deal with clients and brief them about products of the company. He told me while dealing with the clients never ever makes any false statement with the clients and you are in a good looking dress and your behaviour must be polite with the clients. In this department I worked with Mr. Feroz. By working with him the concept of marketing became very clear. He told me always while dealing with the client first priority should be given to the client interest and second to the interest of the company. They have a busy routine. There is a heavy responsibility on their shoulders as they deal with clients for increase company business. They took out time from there busy schedules to guide me how to deal with clients and what type of information share with them.

Motor insurance Motor insurance

Fire insurance Fire insurance

Health insurance Health insurance

Products offered Products offered

Miscellaneous Miscellaneous insurance insurance

Engineering Engineering insurance insurance

Travel insurance Travel insurance Marine Marine insurance insurance

TABLE OF DIFFERENT RATIOS

2008

2009

2010

Leverage Ratios: 57:43

57:43

47:53

1.52

2.00

2.52

51:49

52:48

49:51

0.37

0.31

0.20

Total Assets Turnover Ratio (Times)

1.29

1.32

1.40

Fixed Asset turnover(times)

2.01

2.07

2.40

Gross Profit Ratio

15.30%

12.90%

10.46%

Net Profit Ratio

2.66%

4.15%

4.21%

7.91

5.76

5.00

16.66%

16.48%

16.85%

Break-up Value

22.84

26.63

32.27

Cash Dividend

0.75

0.75

2.82

4.54

Debt Equity Ratio Interest Cover Ratio(times) Liquidity Ratios: Current Ratio Acid Test(Quick) Ratio Efficiency Ratios:

Profitability Ratios:

Inventory Turnover(times) Return on Capital Employed Market Value Ratios: Per Share (Rs.)

Earning Per Share

5.64

BALANCE SHEET ANALYSIS

2008

2009

2010

ASSETS Operating fixed assets capital work in progress long term deposits Current Assets: stores, spares and loose tools stock in trade Trade debts loans, advances, deposits, cash and bank balances Total LIABILITIES Issued subscribed and paid up capital reserve for bonus shares capital reserve share general reserve Un-appropriated Profit Redeemable Capital Long term loans Liabilities against Finance Lease Employee retirement benefits Current Liabilities: short term bank borrowings current portion of long term liabilities Creditors, accrued and other liabilities Provision for taxation Dividends Total

963,961,057 40,260,082 4,027,780

537,836,670 475,214,695 3,996,550

585,592,036 67,435,944 650,550

38,527,545 249,798,561 73,023,993 96,656,807 36,897,243

36,333,854 185,452,931 304,471,808 87,695,275 10,514,208

19,641,030 142,680,978 320,084,928 58,545,904 111,196,417

1,503,153,068

1,641,515,991

1,305,827,787

2002

2001

2000

205,406,250 41,081,250 200,000,000 22,660,143 150,000,000 352,395,341 25,026,591

164,325,000 41,081,250 100,000,000 83,894,927

109,550,000 27,387,500

472,654,396 34,838,087

314,103,910

252,029,514 91,085,082 124,046,467 21,017,438 18,404,992

504,643,382 86,055,167 114,959,651 20,797,245 18,266,886

397,588,859 62,438,535 147,648,360 11,111,902 59,501,735

1,503,153,068

1,641,515,991

1,305,827,787

100,000,000 76,496,986

INTERPERTATION This analysis is describing the five year balance sheet. So, it enables us to observe the comparative progress of the company in these five years in each face item of the balance sheet. It is clear from this table that the operating fixed assets have an increasing trend in the company that these are Rs. 585.60 million in 2000 whereas after 2002 these remains

more then 964 million. As for as the current asset are concerned these are also increasing as the business is expanding annually so the requirements of funds to met day to day needs are also increasing which resulted into increase in the current assets. Share capital of the company was Rs. 109.56 million in the year which was raised up to 163.33 million in the year 2001. Furthermore business expansion necessitated the further issuance of share capital of 41.8 million and share capital figure reached to Rs. 205.41 million in 2002. Capital Reserves of the firm were also raised up to Rs. 136.16 million in the year 2004 from 41.08 million in the previous years General reserves of the co. were also increased from 100 million to 200 million in the year 2002 and this amount was further raised to Rs. 300 million in the year 2003. Long term loans are relatively less raised though the firm has expanded its business volume. As for as, the current liabilities are concerned, the need to meet the business requirements was raised therefore firm has to depend more on the current liabilities. These are not bearing high interest rates therefore these are economical then that of the long term liabilities. In nutshell the comparative figures of the last five years revealed that the company’s progress is increasing rapidly in of its business worth and also its business volume. As the company’s total assets were Rs. 130.50 million which are now increased up to Rs.2045 million which is a good sign.

VERTICAL ANALYSIS OF BALANCE SHEET 2008

2009

2010

64.13

32.76

44.84

capital work in progress

2.68

28.95

5.16

long term deposits

0.27

0.24

0.05

ASSETS Operating fixed assets

Current Assets: stores, spares and loose tools

2.56

2.21

1.50

16.62

11.30

10.93

4.86

18.55

24.51

6.43

5.34

4.48

2.45

0.64

8.52

100.00

100.00

100.00

EQUITIES

2002

2001

2000

Issued subscribed and paid up capital

13.67

10.01

8.39

stock in trade Trade debts loans, advances, deposits, prepayments and other receivables cash and bank balances TOTAL ASSETS

reserve for bonus shares capital reserve share

2.10 2.73

2.50

0.00

13.31

6.09

7.66

Un-appropriated Profit

1.51

5.11

5.86

Redeemable Capital

9.98

0.00

0.00

23.44

28.79

24.05

1.66

2.12

0.00

0.00

0.00

0.00

16.77

30.74

30.45

current portion of long term liabilities

6.06

5.24

4.78

Creditors, accrued and other liabilities

8.25

7.00

11.31

provision for taxation

1.40

1.27

0.85

Dividends

1.22

1.11

4.56

100.00

100.00

100.00

general reserve

LIABILITIES: Long term loans Liabilities against assets subject to Finance Lease Employee retirement benefits Current Liabilities: short term bank borrowings

TOTAL LIABILITIES

INTERPERTATION This analysis is showing the relationship of each item of the balance sheet in ratio to the total assets. It is clear from this analysis that how much of the assets are being kept in which form at this company. The same depiction of the equities side is also provided.

Moreover comparative information of the five years enables us to judge the company’s progress in this time period. Operating fixed assets were 45% of the total assets in the year 2000 whereas these are forming a 65% part of the total assets in the year 2002 which shows that company has increased its fixed assets surely is due to the increase in the share capital. Company has raised its share capital to fulfill the requirement of funds for expansion. Long term deposits are also very short which tells us that company has expanding its business activities therefore it doesn’t have extra funds to put in long term deposits. As for as the stores of the company are concerned these are also increasing as compare to the figure of 2000. The reason of such increase is that by the expansion in business volume it requires more store and stock for ensuring the continuity of operations which is of intense importance in such industries. The ratio of stock in trade and trade debts is increasing annually, which is showing that now company needs more working capital. On the other side the company has issued its further shares to raise funds in 2001 and 2002 Rs. 54.28 million and 41.09 million respectively to meet the business needs. With this share capital induction the owner’s equity portion was raised in these years as compare to 2000. The share capital was 13.67% of the total assets in year 2002 whereas this ratio was declined in the year 2003 because respective portion of general reserve is increased from Rs. 200 million to a Rs. 300 million. And further more, the current liabilities are also increased to meet the working capital needs. Long term loans are 28.79% in the year 2001 where as this ratio was decreased to 20.62% in the year 2004.

HORIZENTAL ANALYSIS OF BALANCE SHEET

2008

2009

2010

LIABILITIES Issued subscribed and paid up capital

187.50

150.00

reserve for bonus shares

100.00 100.00

capital reserve share general reserve

200.00

100.00

100.00

29.62

109.67

100.00

112.19

150.48

100.00

63.39

126.93

100.00

current portion of long term liabilities

145.88

137.82

100.00

creditors, accrued and other liabilities

84.01

77.86

100.00

189.14

187.16

100.00

30.93

30.70

100.00

115.11

125.71

100.00

Un-appropriated Profit Redeemable Capital Long term loans Liabilities against assets subject to Finance Lease Employee retirement benefits Current Liabilities: short term bank borrowings

provision for taxation Dividends TOTAL LIABILITIES

INTERPERTATION

Here I have attempted to show the company’s progress considering the year 2000 as a base year i-e how much company has expanded its business. It is basically the depiction of company’s growth form the year 2000 and up to the current year 2004.

Share capital was increased 150% in 2001 as compare to the paid up capital of 2000. Whereas, the share’s value was increased up 187.50% of the figure in 2000 then it was in the year 2002 and onward. General Reserve figure is increased by 300% in last four years. But the un-appropriated profit is decreased by 73% in the 2004 as compare to the 2000. Long term loans were also increased in the 2002 but the same were reduced after 2002. More critical is that the short term borrowings are increased 175% and the major reason of this increase is that most of the long term loans are achieving their maturity in these years therefore the current portion of long term liabilities is increased by 274% which is much higher. This is the major reason of having week current ratio. Provision for taxation is also increased by 200% (approx) that is due to the expansion of business growth.

PROFIT AND LOSS ANALYSIS

2008

2009

2010

Sales

2,032,159,094

1,252,560,023

1,306,887,918

Cost of Goods Sold

1,721,195,792

1,057,331,258

985,287,197

310,963,302

195,228,765

321,600,721

istrative Expenses

(25,469,915)

(27,366,056)

(19,089,432)

Distribution and Marketing Exp.

(64,920,432)

(33,830,380)

(42,575,769)

220,572,955

134,032,329

259,935,520

(145,384,832)

(98,743,210)

(105,759,182)

75,188,123

35,289,119

154,176,338

(21,017,438)

(15,566,803)

(11,111,902)

54,170,685

19,722,316

143,064,436

Gross Profit Operating Expenses:

other operating Expenses Other Operating Income Profit from Operation Finance cost Profit Before Taxation Taxation Profit After Taxation

INTERPRETATION Profit and loss of the five years are provided here comparatively. From the above figure we can see that company’s sales are increasing rapidly which is a sound signal of rapid business growth. In contravention to the above growth signal the cost of goods sold of company was also increasing, The company’s sales were increased in 2002 by 800

million (approx) whereas increase in the cost of goods sold was high than that of the increase in the sales in 2003. Therefore, the gross profit of the company was decreased. In the year 2004 the sales of the company were reached at peak of Rs. 2750.40 million where as cost of goods sold of the company was also increasing as the business volume is expanding continuously. The gross profit of the company decreased in the year 2003 as compare to the gross profit of 2002. The reason of this is the comparatively more increase in cost of goods sold than that of the sales. As we now that long term loans were raised in 2001 by 150% that’s why the finance cost of the company was raised in the preceding year 2002 that was reached to its maximum of Rs.145 million which reduces the profit before taxation than that of in the year 2000. Whereas now in 2004 most of the long term loans were paid in 2003 & 2002 the finance cost is much reduced. Marketing and distribution expenses are controlled in the 2003 & 2004. That is a factor to good profitability of company in these years.

VERTICAL ANALYSIS OF PROFIT & LOSS

Sales Cost of Goods Sold Gross Profit

2002

2001

2000

135.34

219.58

210.45

121.18

196.61

188.43

15.30

15.59

24.61

Operating Expenses: istrative Expenses Distribution and Marketing Exp. other operating Expenses Other Operating Income Profit from Operation Finance cost Profit Before Taxation Taxation Profit After Taxation

(1.25)

(2.18)

(1.46)

(3.19)

(2.70)

(3.26)

0.00

0.00

0.00

0.00

0.00

0.00

10.85

10.70

19.89

(7.15)

(7.88)

(8.09)

3.70

2.82

11.80

(1.03)

(1.24)

(0.85)

2.67

1.57

10.95

INTERPERTATION

Above figures are showing gradually decreasing percentage of gross profit, provided that the sales of the company are increasing annually. So, it is clear that the cost of goods sold is relatively more increasing than of its sales. In 2004 the operating expenses are just 7.57% of the sales than these were 20% in the year 2000. i-e the increasing of trend in the operating expenses is relatively slow than the sales. Profit before taxation ratio is more in the year 2004 than that of just 2.82% and 3.70% in the years 2002 & 2003 respectively; it is due to reduction of finance cost in current year. Though the gross profit of the company has a decreasing trend, the profit after taxation ratio is relatively raising which shows that beyond the annual increase in the cost of goods sold, other operations of the company are being driven on the right track. It is the vertical analysis of profit and loss s of the company.

HORIZONTAL ANALYSIS OF PROFIT & LOSS 2008

Sales

155.50

2009 95.84

2010 100.00

Cost of Goods Sold Gross Profit

174.69

107.31

100.00

96.69

60.71

100.00

istrative Expenses

133.42

143.36

100.00

Distribution and Marketing Exp.

152.48

79.46

100.00

84.86

51.56

100.00

137.47

93.37

100.00

48.77

22.89

100.00

189.14

140.09

100.00

37.86

13.79

100.00

Operating Expenses:

other operating Expenses Other Operating Income Profit from Operation Finance cost Profit Before Taxation Taxation Profit After Taxation

INTERPERTATION This horizontal analysis of the profit and loss describes the comparative information of above five year. Sales are 210% more than these were in 2000. It shows annual increase in the sales volume. It is obvious that the marketing department is efficient as for as the sales volume is concerned. RWML’S cost of goods sold is also 249% increased. It is an alarming increase in today’s competitive era. As the Company’s cost of goods sold is 30% extra increased than that of the increase in sales. Due to the higher cost the selling price of the product is also increased however, the sales increasing ratio is low than that of cost. This alarming increase in the cost of goods sold is due to the rise in the prices of raw material consumed and packing material used. This increasing trend of cost of goods sold has reduced the company’s gross profit ratio also.

Company has controlled its marketing and respective istrative expenses in 2004 than that of in the last two years. Therefore, the Co. has better net profit ratio than that of the last two years. Over all if we see the company is loosing its profitability as it has more than 80% of the profits in the year 2000. So we can say that the business is growing in its volume but not in the profitability. If we see from the investors point of view whose aim is to maximize their worth. This business is effectively going on but the Co. is not increasing its profitability annually. In the year 2004 the operation profits of the company were declined therefore the taxation cost is also decreased in the year 2004. By reduction in the taxation cost, profit after taxation rose in the 2004. Which were 37% & 65% in the years 2002& 2003 respectively raised up to 81% in the year 2004.

 Mostly insurance companies are endeavoring to bring to its customers new and improved products and services that provide efficient and effective solutions such

as web-based e-insurance company allows its customers to access its insurance services via internet. Corporate customers can efficiently conduct their day-to-day insurance covers claim information, current status of the claim, rate of of different risks and much other information as they required via an automated, versatile and a straight through processing platform's would like to recommend Askari insurance company to provide this facility to their customers as well.  There should be central complaint cell in company in order to reduce the people’s complaints and foster the ratio of productivity.  Money laundering and white-collar crimes are on the rampant. Aggressive and comprehensive

mechanism

should

be

set-up

to

save

company

 General working conditions ought to be improved.  AGICO needs to improve its website. More information relating to insurance covers should be available on the website.

 Management should distribute work equally among different employees. Some of the employees are overburdened while some sections are overstaffed.  Askari Insurance Company needs to use more marketing channels to make the public aware of its products and services. In the presence of intense competition Askari insurance Company has to realize the importance of marketing.

One of the most important aims of the student life is to express him / her correctly and adequately. This was believed in my mind when I first decided to go to Askari Insurance Company to complete my internship program. The company has been growing both in size and profit for past few years and has a good repute in the market. The year 2011 is expected to offer increased competition in the business as more insurance companies are in the market. With their focused strategy and product development initiatives planned for the year, Askari Insurance Company is strongly positioned to meet these challenges. The Askari insurance company has very well repute in the market overall insurance company is going well and doing a good business but there are few problems for that I have tried to give few recommendations that might help company to improve. So finally this internship has helped me a lot in gaining practical knowledge of job that will help me in the real job once I complete my MBA. While conducting this report I faced some problems in getting the data as at websites data is not managed very well. The knowledge of what I have studied in MBA also came in handy. Once every thing was found out it got very interesting. I am very thankful to all the employees of askari general insurance company my friends and teachers and my brother. Who all help me in the preparation of this internship report and encouraged me.