Igi Insurance Company

COMPANY PROFILE & HISTORY:...................................................................................1 1.1PIONEERS OF IGI:........................................................................................... .....2 1.2HOW IGI STARTED ITS BUSINESS:.......................................................................3 1.3MAIN PRODUCTS AT IGI:.....................................................................................4 2.STRATEGIC MANAGEMENT PROCESS:......................................................................8 2.1MISSION:........................................................................................................ .....8 2.2VISION:....................................................................................... ........................9 2.3GOALS AND OBJECTIVES:............................................................................... .....9 2.4SWOT ANALYSIS:........................................................................................ .......10 3.ORGANIZATIONAL DIRECTION:...............................................................................12 4.STRATEGIES:....................................................................................... ...................12 4.1. GENERAL STRATEGIES FOLLOWED BY IGI:......................................................14 5.ENVIRONMENTAL FACTORS:...................................................................................14 5.1. RELEVANCY OF ENVIRONMENTAL FACTORS TO IGI:........................................17 5.2. ENVIRONMENTAL MONITORING THROUGH SCANNING:..................................18 6.STRATEGY IMPLEMENTATION AND EVALUATION:....................................................18 7.CONCLUSION:........................................................................................................20 8.ANNEXURE 1:.................................................................................................. .......21 ........................................................................................................ .........................22 9. ANNEXURE 2:................................................................................................. .......23

COMPANY PROFILE & HISTORY: International General Insurance Company of Pakistan Limited (IGI) is a group company of packages Limited. IGI was established in 1953 in collaboration with Alliance Assurance of Great Britain. Syed Maratib Ali was its first Chairman and Syed Babar Ali the first Managing Director. The present Managing Director is Syed Hyder Ali and the General Manager Basit Hassan Syed is

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currently the Vice Chairman of Insurance Association of Pakistan (IAP). Packages Group is one of the leading business houses in Pakistan with interests in paper, board and packaging, dairy and food, polypropylene film, pharmaceuticals, chemicals and investment banking sectors besides insurance. During its 47 years of operations IGI has built a reputation that has strengthened its business. IGI is ranked second amongst the general insurance companies in Pakistan on the basis of Market/ Realizable value of its assets. IGI's total commitment to customer's satisfaction, professional/ethical approach and prudent management practices has enabled it to develop very cordial and long lasting relationship with its clients, which include highly reputed local as well as multinational companies. Recently the Company has been awarded AA (Double A) Claims Paying Ability (CPA) rating by Pakistan Credit Rating Agency (Private) Limited (PACRA), an affiliate of FITCH Ratings Limited, London. This is the highest rating amongst the local insurance companies and has given lot of confidence to us as well as our clients. Amongst Pakistan's insurance companies, IGI has one of the highest Solvency Margins of 479%. IGI's policy of prompt and fair claim settlement is evident from the fact that IGI has one of the LOWEST outstanding claims in the domestic market. Our valued clients include professional and reputed local as well as multinational companies. IGI Insurance Limited has re-insurance agreements with the most prestigious and worldrenowned re-insurers such as Swiss Re and Sumitomo Re. The Company is referenced for its good standing and reputation by domestic as well as international reinsurers. During the year 2001 (in July 2001) the Company achieved another milestone by obtaining ISO 9002 certification from SGS Malaysia Sdn. Bhd. IGI Insurance was the FIRST general insurance Company in Pakistan, which had achieved this certification for its entire operations.

1.1PIONEERS OF IGI:

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Syed Maratib Ali was the first Chairman and Syed Babar Ali was the first Managing Director of IGI which is a part of the Packages Group which is one of the largest conglomerates of the country with interests in paper and board, milk and dairy, chemicals, investment banking and insurance The present Managing Director is Syed Hyder Ali and the General Manager Basit Hassan Syed is currently the Vice Chairman of Insurance Association of Pakistan (IAP).. The company is listed on Karachi and Lahore stock exchanges has history of more than 50 years of successful commercial operations. IGI is the global network partner of (R&SA) global network limited for their global businesses in Pakistan The current chief executive officer has over thirteen years of experience in key management positions in financial sector. The key management personnel’s list is in annexure 1.

1.2 HOW IGI STARTED ITS BUSINESS: IGI started its operations through Financial Services which is a group brand representing four organizations of IGI namely: IGI Insurance, IGI Investment Bank, IGI Securities, IGI Funds. The companies offer financial services like insurance, investment banking, brokerage services and asset management to Individuals and Corporations. IGI Financial Services is headquartered in Karachi and operates through a network of branch offices in Lahore, Islamabad, Faisalabad, Multan, Gujranwala and Sialkot employing more than 400 people. IGI Financial Services is associated with the Packages Group which is amongst the largest groups in the country. Packages Group has interests in paper and packaging products, food items and chemicals Ð inks and dyes.

In 1953, IGI Insurance Limited was established under the name of International General Insurance Company of Pakistan Limited with the objective of providing quality general

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insurance services through a customer-oriented approach combined with the highest standards of ethical practices. In 1956, Packages Limited was incorporated as a joint venture with Akerlund and Rausing, Sweden. The Packages Group expanded quickly through strategic business alliances with major multi-nationals like Nestle, Tetra Pak, Mitsubishi and Coca-Cola.

Packages Group and Associated Companies:

1.3 MAIN PRODUCTS AT IGI: Home Cover:

An affordable home insurance plan from the company that has been trusted for the past five decades. ‘Home Cover’ gives a comprehensive coverage against any accidental damage caused to the homes or rented property in case of robbery, fire, accidents, or natural disasters for a

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maximum of Rs. 20 million. Home Cover is a customized insurance solution for all home owners/renters as it insures home property, home contents, jewellery at home, home owner free rent, home tenants free rent, cash at home and also allows customers to get other value added services at discounted rates. Travel Sure:

Travel Sure has been revised and now offers customers an enhanced policy with better rates and more coverage. It is the finest plan that has been specially tailored according to the traveling needs in order to make a journey of a customer stress free with the assurance that any and all emergencies will be taken care off in a prompt and professional manner. Their plan offers a cover for US$ 50,000 for medical treatment abroad, accidental death and emergencies, personal liability, flight delays, loss of passport and loss of baggage. It also assists in fulfilling visa requirements and also provides other free assistance services as mentioned ahead. With Travel Sure customers feel the freedom of availing medical benefits at foreign facilities through a 24-hour complete access to International SOS Pte. Ltd, which will guide and support them during all emergencies.

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Health Sure:

Health Sure offers a managed care solution to corporate clients and organizations to provide healthcare needs backed by professional staff, financial strength and insurance experience accumulated over a period of fifty years. Health Sure covers personal health covers, hospitalization covers and maternity covers. In addition, the product covers pre- and post-hospitalization expenses as well. The covers also have a credit facility at IGI Insurance’s panel of hospitals across Pakistan, Health Cards; discounts at pharmacies and diagnostic laboratories; 24-hour medical hotline with staff doctors etc.

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Auto Cover:

Auto Cover is a complete auto insurance plan for both individuals and corporate offering: •

A comprehensive cover including theft, snatching, armed hold up, accidental damage, third party liability and terrorism.

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The liberty to have the vehicle repaired at the workshop of customer’s own choice and the cost of repairs are being directly settled with the workshop.

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Reduction of premium up to 50% through no-claim bonus, which is transferable from other insurance companies and within immediate family members.

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Guaranteed settlement of Snatching/Theft/Total Loss claims within 15 days of recovery of snatched/stolen vehicle.

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Free anti-theft device without any renewal condition. 24

2. STRATEGIC MANAGEMENT PROCESS: Strategic management process is comprised of the following steps and they all are being carried out at IGI very effectively:

Over the period of time IGI has developed very effective strategies and implemented them which have allowed them to gain the highest market share. IGI’s success depends on the effective identification of organizations’ current mission, vision, goals and strategies. The vision, mission and goals are as follows:

2.1 MISSION: Their vision will be realized through: Customers: Being the preferred insurer in providing solutions to risk exposure. Shareholders: Consistently delivering above market average return on capital. Employees: Providing the environment necessary to be the employer of choice.

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Community: Compliance with the highest ethical and moral standards.

2.2 VISION: “IGI Insurance is committed to being one of the leading providers of solutions to risk exposures in selected market segments in Pakistan.”

2.3GOALS AND OBJECTIVES: The main goals and objectives of IGI are very soaring in quality and they are well established and spread all over the organization over the period of time. They are just like a norm now at IGI. Those objectives are as follows: •

Customer satisfaction through superior customer service.

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Prompt settlement of claims.

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Professional & ethical business practice.

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To enhance financial strength of the Company by achieving outstanding financial results.

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To ensure regular and respectable pay outs to the shareholders.

IGI Insurance believes in providing high quality solutions to risk exposures to the satisfaction of its customers through: •

Developing and maintaining a total quality culture

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Developing capabilities of the employees

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Continuous improvement and teamwork

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Updating business knowledge and techniques

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•

Efficient utilization of resources and manpower

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Introducing high standards of professionalism.

2.4 SWOT ANALYSIS: The swot analysis is the second step in the strategic management process and SWOT analysis of IGI as follows: Strengths: •

IGI has established its reputation in domestic as well as international insurance market for quality insurance business and adherence to high ethical and professional standards.

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Total commitment to customer satisfaction.

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Highly professional attitude towards underwriting risk and prudent management practices.

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Value creation for customers and shareholders alike

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AA (Double A) Claims Paying Ability (CPA) rating by Pakistan Credit Rating Agency.

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Very Strong Claims Paying rating.

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highest rating amongst the local insurance

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IGI has one of the HIGHEST Solvency Margins.

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Customer satisfaction through superior customer service.

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Prompt settlement of claims.

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Professional & ethical business practice.

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To ensure regular and respectable pay outs to the shareholders.

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Weaknesses: •

Only 9 hospitals are listed within Rawalpindi and Islamabad as compared to population of twin city.

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IGI has CREDIT arrangements with the above mentioned hospitals nationwide. All hospitals administrated by Government and Armed Forces of Pakistan are also approved but NO CREDIT facility with them and patients may subsequently seek reimbursement from IGI.

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Claim procedures need a lot of documentation and verification.

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Lacks some of the services offered by competitor insurance companies.

Opportunities: •

Increased trend of insurance now days.

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Car insurance must by government on leased cars.

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Increased security concerns lead to growth in insurance sales.

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IGI investment bank enjoys repute build by its insurance division.

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IGI securities services as its another division capitalizing.

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IGI funds division gives edge over competitors.

Threats: •

High markup rates discouraged sales of leased cars.

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Volatile business environment.

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Competition by other companies like EFU, ADAMJEE, STATELIFE etc.

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Governmental favoritism policy while giving contracts to politically influenced companies.

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Changing laws and regulations with every new government.

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Ministries involved in contracts to governmental clients which cause delay in decision making.

3. ORGANIZATIONAL DIRECTION: The organizational direction at IGI is very clear and well aligned with the organization’s vision, mission and goals, the employees at IGI are well informed and they know what are the goals and objectives of the organization and that is why they know the direction where the organization is headed. At IGI they have very clear and well defined philosophy which is embedded in customer satisfaction through superior service, prompt payment of claims, professional and ethical practice. The prompt payment of claims can be judged from its AA rating of CPA (Claims Paying Ability), which is the highest amongst the local general insurance companies in Pakistan. In addition to this IGI is also the first general insurance company to achieve ISO 9002 certification. For any insurance company, reinsurance arrangements with professional, dependable and financially sound re-insurers are very essential. IGI has prestigious reinsurance arrangements with the worldwide acclaimed re-insurers including; Munich Re of Germany, Swiss Re of Switzerland and General Colongne Re of Germany. All these enjoy an international rating of AAA, providing a reliable risk diversification base to the company and confidence to its clients.

4. STRATEGIES:

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Corporate Level Strategy: The corporate strategy of IGI Insurance Ltd is Growth. While following growth IGI indulge in Market penetration strategy and Diversification. In line with the Company’s growth strategy, it has acquired the Pakistan operations of Royal and SunAlliance Plc. U.K. As a result of this transfer, IGI has positioned itself amongst the top five insurance companies operating in Pakistan. IGI Insurance Limited is now a global network partner of Royal and SunAlliance Plc U.K. They are also joined hands with PAMADA to provide “IGI Auto Cover” in PAMADA’s exclusive panel of automobile insurance providers for prospective buyers. And they are also exploring more areas to grow in the future. This type of strategy usually seeks to gain a competitive edge through pricing, marketing, or other initiatives. Additionally, market penetration can be achieved by increasing customer usage through loyalty programs and incentives targeting existing customer base. IGI is operating in financial markets and all the diversifications are concentric. Business level strategy: In business level strategy IGI follows Differentiation strategy and Focus strategy in order to achieve a sustainable competitive advantage and long-term success. IGI differentiates on the basis of high class Serviceability and re insurance services from the other insurance companies. IGI’s main focus is on expansion of financial services for the clients and providing them best services. Operational level strategies: Operational level strategies are very narrow in focus and deals with day-to-day operational activities such as scheduling criteria. It operates within a budget but is not at liberty to adjust or create that budget. Operational level strategies are informed by business level strategies which, in turn, are informed by corporate level strategies. The daily operations strategies aligned with IGI Insurance Ltd are as follows:

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Promotion of staff into management positions.

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Promotion of staff into supervisory positions.

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Continued improvement to customer service levels.

Operational and business level strategies are appropriate with the direction of IGI and it is clearly noticeable by the success of IGI over the period of more than 50 years in Pakistan.

4.1. GENERAL STRATEGIES FOLLOWED BY IGI:

The general strategy of IGI focuses on following elements: Expansion of business: IGI has expanded into many cities of Pakistan and is still in growth phase. Customers Serviceability: Customer’s satisfaction and serviceability is the point of differentiation for IGI. Therefore all efforts are made to achieve this goal. Different types of different services and products have been introduced to maintain the competitive edge. Settlement of claims in insurance in major issue, IGI solves Claim issues in minimum time than all other competitors. Technology advancement: IGI has data base management system through which it maintains all the accounts of clients. Online services are also available to facilitate the clients. Corporate Social Responsibility: In order to be known as socially responsible company IGI often indulge in different social activities from giving trainings to poor people to giving funds for needy . IGI is ethically very stable organization.

5. ENVIRONMENTAL FACTORS:

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It is one of the leading general insurance companies operating in Pakistan. IGI underwrites all the three main classes of general insurance business i.e. Fire, Marine, Motor and Miscellaneous. During its 56 years of operations, IGI has established its Reputation in domestic as well as international insurance market for quality insurance business and adherence to high ethical and Professional standards. The organization is critically analyzing its environmental factors that include the following.

Demographics:

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The demographics include the age, gender the education level, social class, lifestyle, race and ethnicity .So the IGI considers all these factors while developing an insurance plan for a person according to his level of preferences and other demographic factors. For example it has different insurance policy as for the organizations and multi nationals who insure their employees as compared to individual ones. Culture: The cultural factors that are the set of beliefs, moral values, traditions, language also being considered by IGI as they play significant role in designing the strategy. For example the people differs in culture they have different set of beliefs and values which effects the decision making therefore the culture of IGI highly influence the decision making.

Economic factors: The economic factors are vital in designing the strategy so as IGI do. The economic factors include interest rates, governmental policies, management and taxation. For example when interest rates are low more people buy leased cars and according to governmental policy they had to be insured, and it may be a governmental policy at the time that a plaza or building should be insured to get “no objection certificate” from the concern department. Governmental factors: The governmental factors like claim policy, risk assessment level, credit ratings, policy and requirements to offer the insurance policy, the clearance from different departments , political impacts and other regulatory requirements are also considered while developing the strategy. For example it may be a governmental requirement that a specific residential tower should be insured by a company with sound repute and AA credit rating etc. Technological factors:

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The technological factors have a great deal of influence over IGI insurance company and so as it is designing its strategy and affects the strategy making process. The technological factors include new emerging technologies, the level of innovation etc. A very good example in IGI case is that the insured cars are now being installed by a GPS vehicle tracking system. Similarly automatic fire alarm systems are an example of these technological factors.

5.1. RELEVANCY OF ENVIRONMENTAL FACTORS TO IGI:

All factors that are discussed above are relevant to the organization and to further justify that some examples are given for each of the environmental factors related to the IGI. •

The demographic factors like level of education and income level had lead to the awareness in people about the insurance policy so it is easy to convince an educated person to have insurance policy. So the IGI agents sell more insurance policies as the people had awareness about these policies etc.

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Cultural factors are also considered by IGI as we know the law and order conditions in our country so the people have became insecure so they buy insurance policies in order to secure their families in case of their sudden death etc. Other street crimes and robbery lead to car insurance as a part of our culture now.

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Economical factors also lead IGI to capitalize as the cars are available on lease on low mark up so people rushed to them and so as per requirement they have to be insured as well.

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Governmental factors which IGI find opportunity is the regulatory requirements like a commercial building should be insured, employees of organizations should have insurance etc.

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Technological factors that IGI considers like GPS vehicle Tracking system, automatic fire alarms etc.

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These all environmental factors are relevant to the organization and the strategy is designed considering them all.

5.2. ENVIRONMENTAL MONITORING THROUGH SCANNING: Yes , the organization monitors its environment through scanning, it had its own team of analysts who get the information about the current trends. Its products research and development teams also work on the environmental scanning. They always have a backup plan if any of their plans fails similarly how to out play their competitors. The data of the population, their demographics, and the new innovations all of them have to be scanned as future is unpredictable and there is tough competition in such a volatile business environment. An internal environmental scan involves looking at the present capabilities of the organization (infrastructure, hardware, personnel, abilities, structure, etc) and that information can be compared to what the organization will need in the future to achieve its strategic goals. In terms of organizations and strategic planning, an environmental scan involves considering the factors that will influence the direction and goals of their organization. And, it includes consideration of both present and future factors that might affect the organization, since, they are planning for the future, not just the present. For example, an environmental scan might project that in the next ten years, the number of people (potential customers) between the ages of 18-24 will increase from 30% to 40%. That's important information if they want to decide what kinds of new products they might consider introducing into the marketplace. Should they work on developing products targeted at a dwindling senior’s population? Or should they develop products to take advantage of the shift to a youth dominated market. The environmental scan forces them to look at these factors.

6. STRATEGY IMPLEMENTATION AND EVALUATION:

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The above discussed factors are considered while making the strategy and in the end considering all the data of environmental scanning, SWOT and pest are evaluated and then strategy is being made. Another back up strategy is also being made to consider any discrepancy or other uncertain event etc. So according to standard the strategy is implemented like in case of any accidental vehicle its pictures are taken at the spot , interviewed the driver similarly before finalizing any building for insurance certain test of its material , fire exits all are evaluated then any decision is made whether to insure it or not as per strategy is considered then. The strategy is implemented at all business levels and stakeholders are set notice if any change comes. Over the period of time, IGI has developed it’s organization, it’s people have developed both professionally and personally, and together all have been rewarded with profitable sales growth, diversification, and new market penetration which shows the effective development and implementation of strategies at IGI. Recently IGI has joined hands with PAMADA, The agreement will effectively include, “IGI Auto Cover” in PAMADA’s exclusive panel of automobile insurance providers for prospective buyers. In a statement after the signing ceremony Mr. Saulat Said, CEO of IGI Insurance said, “We are making major headway in the automobile insurance sector. Our aim is to introduce “IGI Auto Cover” to PAMADA association so that it becomes the preferred choice for individuals when they consider automobile insurance.” IGI Insurance Limited also introduced the IGI Insurance Travel Sure Umrah Plan exclusively for the sacred journey of Umrah. With the approach of Ramazan, IGI Insurance Limited decided to bring forward a comprehensive solution to provide pilgrims with a hassle-free experience and protect them from the troubles of travel. The IGI Travel Sure Umrah Plan ensures safety and convenience by offering additional services including lost luggage, legal referral, telephone medical advice, arrangement of hospital admission, medical translation service and delivery of essential medicine. Furthermore, families can avail cover of up to $2000 for children between age 1 month and 18 years.

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These are some of the areas where IGI is expanding and developing strategies to expand in other sectors as well.

7. CONCLUSION: IGI is one of the leading insurance company in Pakistan with wide range of products and it has been providing comprehensive risk management services since 1953.. Their covenant with the customers has always been to provide the best risk management services in Pakistan. Thus they have achieved through a total commitment to customer satisfaction, a highly professional attitude towards underwriting risk and prudent management practices. By developing a long-term relationship with their clients, in the last four decades, they have strived to create value for their customers and shareholders alike.

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8. ANNEXURE 1:

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9. ANNEXURE 2: Graphical High Lights Of IGI performance

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HIGHLIGHTS (Rupees in Million)

PREMIUM AND LOSSES (Rupees in Million)

FIRE DEPARTMENT (Percentage)

NUMBER OF POLICIES SOLD

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REFERENCES: http://www.igiinsurance.com.pk/assets/pdf/Health.pdf http://www.lmi.ie/IGI_Insurance.pdf http://www.thinkingmanagers.com/business-management/business-strategy.php http://www.igi.com.pk/company_Profile.asp#Insurance

IGI annual report 2008-09

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