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EFU General Insurance Ltd.

Final Project

The south Asia in general and Pakistan in particular has become the focus of entire world since incident of September 11. The existing geo-political environment has grave repercussions on the insurance industry of the region. This has resulted in high insurance rates for all kinds of insurance products. Insurance business has never been in so much of lime light as it is today in our country. Keeping its significance in present environment, we have decided to initiate an analytical study on this subject from management perspective. Therefore, we will be trying to take this project on analytical study of insurance business in Pakistan. After contemplating through the merits and demerits of different insurancebusiness related topics and after evaluating their importance in the subject of Management, especially their implication in the Pakistani industry, we selected to the EFU-a multinational Insurance business. And another basic reason of choosing this particular topic was to see that what is insurances business all about and what is its significance in a country like Pakistan?

PROSPECTIVE SIGNIFICANCE OF THIS PROJECT:

There are many national and international companies doing business in many different fields, in countries all over the world. Insurance is the field, which is not fully utilized/ expanded to its optimum in underdeveloped and developing countries like Pakistan. There is a big scope for this field in Pakistan and it can provide relief and source of earning to Pakistani people. EFU is a multinational enterprise and has become a well-established company in Pakistan. It is in this field for over five decades in subcontinent and later Pakistan (after1947). This project will not only be about the EFU Insurance Company and its performance but it will also give a complete insight of the insurance business. We will try to highlight the some of the important aspects of insurance business.

BACKGROUND: In the early 30s of the 20th century, under the inspiration of the Quaid-e-Azam Mohammad Ali Jinnah, there began to appear signs of economic renaissance of the Muslims of India. Shipping, Airline, Banking and Insurance companies made their debut. 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 Calcutta 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 second largest non-life insurance company in the country and the mother company of other insurance organizations of EFU Insurance Group. In June 1990 the Government of Pakistan decided to allow Life Assurance business in private sector also. On 18 November 1992, EFU Life was granted a license to carry on life assurance business. It started operations immediately with Group Life products and in March 1994 launched its Individual Life products. EFU entered the field of life assurance with the focus on the changing needs of the population. The company is committed to provide its policyholders with solutions to the problems of today's complex and rapidly changing financial environment by introducing innovative, and modern products. In March 2000, Allianz Aktiengesellschaft (Allianz AG), a global leader in the insurance industry with an active presence in 70 markets across 5 continents and EFU Group signed a joint venture to form a new company for providing health insurance cover to the people of Pakistan. Allianz EFU Health Insurance Limited, approved by the Government of Pakistan, is the first specialized health insurance provider in the country and aims to play a pivotal role in developing the health insurance market in Pakistan. Traditionally the EFU name has become synonymous with progressiveness and prompt claim settlement and now the EFU being the largest insurance group provides a full range of general, life and health insurance services.

EFU TODAY: Today EFU continues to be a leader in the insurance industry in Pakistan: •

EFU GENERAL INSURANCE LIMITED is Pakistan's pioneer general insurer with the industry's highest premium growth in 2003 of Rs. 86 crores.

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EFU LIFE ASSURANCE LIMITED is Pakistan's largest private sector life insurance company with over 60% market share.

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ALLIANZ EFU HEALTH INSURANCE LIMITED is Pakistan's first specialized health insurer protecting over 320 groups and 100,000 persons.

EFU Group is one of the few Pakistani organizations run totally by professional management. Another unique feature of EFU is a voluntary review mechanism by professionals of international repute. EFU has taken Mr. Wolfram W. Karnowski, who retired at a very senior level from Munich Re, on its Board of Directors. It has appointed Mr. Michael J de H. Bell, a very eminent UK based actuary (retired from Wyatt Watsons and chairman of a UK based life company). EFU has the services of Mr. S.C. (Hamid) Subjally, who retired from a very senior position from Assicurazioni Generali, Dubai, UAE. The independent reviews by these professionals enable the group companies to keep abreast of international changes in the industry as well as ensure that management adopts the best international practices. Another pillar of EFU's strength is a very close and long term (over 50 years) relationship with its main reinsurer, ‘Munich Re’, the largest reinsurance company in the world and the strong support of Allianz Aktiengesellschaft (Allianz AG), a global leader in the insurance industry.

HIRARCHICAL CHART OF THE ORGANIZATION: Rafique R. Bhimjee Chairman

Saifuddin N. Zoomkawala Managing Director & Chief Executive

Hasanali Abdullah, F.C.A. Deputy Managing Director & Corporate Secretary

Mahmood Lotia, A.C.I.I. Deputy Managing Director

DATA PROCESSING DEPARTMENT:

Syed Ahmad A. Haq, M.Sc. Executive Director

Abdul Hameed Qureshi, M.Sc. Senior Vice President

Masroor Hussain Vice President

Mohammad Kamil Khan Vice President

Mohammad Nasir Vice President

ENGINEERING, BOND, MISC. & LAW DEPARTMENTS:

Afaq Ahmad, A.C.I.I. Executive Director

Aftab Fakhruddin, B.E. Executive Vice President (Engg.)

Aamir Nayab Ahmed, B. Arch. Vice President (Engg. Claims & Bonds)

Altaf Ahmed Siddiqui Vice President (Miscellaneous)

Khurram Nasim Assistant Vice President

Abdul Hafeez, LL.B. Vice President (Law)

MARINE DEPARTMENT:

A. Razzak Polani Executive Director

Javid Niaz Khan, M.A., A.C.I.I. Assistant Executive Director

Jawahar Ali Kassim Senior Vice President

Badar Ameen Sissodia Assistant Vice President

Mohammad Ilyas Assistant Vice President

M. Sohail Nazir, M. Sc (Econ.), A.C.I.I. Assistant Vice President

FINANCE DEPARTMENT:

Hasanali Abdullah, F.C.A. Deputy Managing Director

Altaf Qamruddin Gokal, A.C.A. Senior Executive Vice President

Syed Mehdi Imam, M.A. Senior Executive Vice President

M. Mubashirullah Khan Executive Vice President

Aslam Abdullah Ghole, F.C.I.S. Vice President

Qasim Ali Mohammad President

Zakaria Suleman Vice President

Vice

FIRE DEPARTMENT:

Khurram Ali Khan, B.E. Senior Executive Vice President

Thomas Leo Fernandez Executive Vice President (Fire Claims)

Kamran Arshad Inam Vice President

Mohammad Arshad Khan Assistant Vice President

Shahkar Hasan Khan, A.C.I.I. Assistant Vice President

Syed Abid Raza Rizvi, M. Com. Assistance Vice President

Syed Ahmed Hassan, M.B.A. Assistance Vice President

MOTOR DEPARTMENT:

A. Razzak Polani Executive Director

Jehanzeb Karamat Executive Vice President

Imran Ahmed, B.E., M.B.A., A.C.I.I. Senior Vice President

Mahmood Jafri Senior Vice President

Baqar Aneel Jafari Assistant Vice President

STATISTICS & CREDIT CONTROL DEPARTMENT: Muhammad H. Hashim Vice President Syed Saghirul Hasan Assistant Vice President

Rana Zafar Iqbal Assistant Vice President

Rao Abdul Hafeez Khan Assistant Vice President