A REPORT ON

PREMIER INSURANCE CO. (NEPAL) LTD.

Submitted by:

Prashant Thapa Magar

Kritika Shrestha

Sapoj Thokar

Sujata Poudel

Asha Baniya

Prakash

Bachelor of Business Administration

Submitted to:

Citizen College

Faculty of Management

Pokhara University

Kumaripati, Lalitpur Nepal

 INTRODUCTION

PREMIER INSURANCE CO. (NEPAL) LTD. incorporated on 12th May 1994, Premier
Insurance Company (Nepal) Limited has emerged as a renowned general insurance company
of the second generation. The company has earned a reputation in the local and international
insurance and reinsurance sectors as well for its professionalism and services. Premier’s
success in the insurance and reinsurance business owes itself to the determination of its
promoters to succeed. Comprised of prominent entrepreneurs, the promoters of the company
have brought their experiences, entrepreneurial talent and leadership skills to add to the
company’s growth.

Premier’s greatest strength is its people. In a business that begins and ends with people,
Premier’s human resources has huge responsibilities on it’s shoulders. Regularly trained on
the latest technology, Premier’s staff provides efficient service to its customers. They are also
trained on developing innovative and custom-made products, better risk management
solutions and quality service for maximum security to customers.
The company’s dedication to provide better customer service also reflects through its
associations with leading insurance and reinsurance securities of the world rated, highly for
claim payment capabilities by reputed agencies like Standard & Poor (S&P).

Today Premier has the best and the most secure reinsurance arrangements to cover all types
of claim settlements.

As part of the company’s efforts to serve people countrywide. it has established four regional
offices. The Birgunj office covers southern part of the country. The Narayangarh and Pokhara
offices cover the western part of the country while the Biratnagar office covers the eastern
region of Nepal. New offices in other parts of the country are scheduled to be opened soon.
With its 64 branches, the Insurance has market presence in all major places across the
country. The Insurance is planning to expand its national market to international market to
work jointly with foreign Insurances. Currently, Premier Insurance has market power in all
regions where a regional manager in each region is appointed to serve the market in major
Financial Centers, Terai, Mountain, and remote areas of the country even in the place where
no any Insurance institution has reached before. However, the major market of Premier
Insurance is in Kathmandu only inside Kathmandu valley, there are 11 branches to capture
large market area of the capital city.

With its 64 branches, the Insurance has market presence in all major places across the

country. The Insurance is planning to expand its national market to international

market to work jointly with foreign Insurances. Currently, Premier Insurance has

market power in all regions where a regional manager in each region is appointed to

serve the market in major Financial Centers, Terai, Mountain, and remote areas of the

country even in the place where no any Insurance institution has reached before.

However, the major market of Premier Insurance is in Kathmandu only inside

Kathmandu valley, there are 11 branches to capture large market area of the capital

city.

Major Customer:

Premier Insurance has customer base of above 1,00,000 across the country. The

major customers of Premier Insurance are:

a. Individual Customers: Individuals are the people holding a policy for personal

or family assurance.

b. Corporate Clients: These clients include companies like banks, construction

company, hydropower, etc.

c. Unincorporated Associations Customers: Premier Insurance provides

insurance services to incorporated associations and clubs started for purpose of

Sports, Recreation, Art, Education, etc. that have reliability and reputation.

Hence PREMIER INSURANCE CO. (NEPAL) LTD. is expanding its market and
customers for the development of the trade and in Nepal. Its major market and

customer is viewed to be every nook and corner of the country and it is extending

further more branches in the various cities in the near future.

Premier Insurance also provides different variety of services in many sectors in order to

minimize the risk and to overcome the financial boarder of the people. Till this day Premier

Insurance been providing services in the field such as listed below.

a. Fire Insurance

b. Motor Insurance

c. Marine Insurance

d. Engineering Insurance

e. Household Insurance

f. Public Liability Insurance

g. Travel Medical Insurance

h. Burglary Insurance

i. Bankers Blanket Indemnity Insurance

j. Money Insurance

k. Trekking Insurance

l. Cattle Insurance

m. Health Insurance
n. Personal Accident Insurance

o. Group Personal Accident Insurance

p. Group Medical Insurance

q. Other Miscellaneous Insurance

Functions of Premier Insurance

Premier Insurance handles the following primary functions;

1. Providing certainty

Insurance provides certainty of payment at the uncertainty of loss. The uncertainty of loss can

be reduced by better planning and administration. Butthe insurance relieves the person from

such a difficult task. Moreover, if the subject matters are not adequate, the self-provision may

prove costlier. There are different types of uncertainty in a risk. The risk will occur or not,

when will occur, how much loss will be there? In other words, there is the uncertainty of

happening of time and amount of loss. Insurance removes all these uncertainties and the

assured is given certainty of payment of loss. The insurer charges the premium for providing

the said certainty.

2. Insurance provides protection

The main function of insurance is to protect the probable chances of loss. The time and

amount of loss are uncertain and at the happening of risk, the person will suffer the loss in the

absence of insurance. The insurance guarantees the payment of loss and thus protects the

assured from sufferings. The insurance cannot check the happening of risk but can provide

for losses at the happening of the risk.

3. Risk-Sharing

The risk is uncertain, and therefore, the loss arising from the risk is also uncertain. When risk

takes place, the loss is shared by all the persons who are exposed to the risk. The risk-sharing

in ancient times was done only at the time of damage or death; but today, based on the

probability of risk, (he share is obtained from every insured in the shape of premium without

which protection is not guaranteed by the insurer.

Besides the above primary functions, the insurance works for the following functions:

4. Prevention of loss

The insurance joins hands with those institutions which ate engaged in preventing the losses

of the society because the reduction in loss causes the lesser payment to the assured arid so

more saving is possible which will assist in reducing the premium. Lesser premium invites

more business and more business causes lesser share to the assured. So again premium is

reduced to which will stimulate more business and more protection to the masses. Therefore,

the insurance assists financially to the health organization, fire brigade, educational

institutions and other organizations which are engaged in preventing the losses of the masses

from death or damage.

5. It provides capital

The insurance provides capital to society. The accumulated funds are invested in the

productive channel. The death of the capital of the society is minimized to a greater extent

with the help of investment in insurance. The industry, the business, and the individual are

benefited by the investment and loans of the insurers.

6. It improves efficiency
Insurance eliminates worries and miseries of losses at death and destruction of property. The

carefree person can devote his body and soul together for better achievement, it improves not

only his efficiency but the efficiencies of the masses are also advanced.

7. It helps in economic progress

The insurance by protecting the society from huge losses of damage, destruction, and death,

provides an initiative to work hard for the betterment of the masses.

Organization’s Mission and Objective

Mission statement:

a. Premier Insurance mission is to become a leading Insurance by providing best

quality insurance services to our customers.

b. To be the most trustworthy Insurance Company and a force to reckon with.

Vision:

a. Our vision is to become the best Insurance based on operational excellence

and superior financial performance.

b. To deliver the comprehensive Insurance solution strengthening its extensive

network.

c. We are committed to be a model of excellence to our customers and employees,

treating them with dignity, honesty and respect and by continually improving in our

insurance products and services.

Objectives:

a. To distinguish our products, services and policies as exceptional in ways that the

customer values.

b. To provide success oriented environment for employees.

c. To utilize the best technologies available and make maximum use of Information

Technology (IT) to deliver quality solutions that provides efficiency and cost

effectiveness.

d. To strengthen market in all the commercial areas of Nepal.

e. To achieve highest premium yields per employee

 Organizational Design and Structure:

Chairman

Board of Director Board of Director Board of Director

Chief Executive
Officer

General Manager

Deputy General
Manager

Human- Under Marketing Accounts Claim Administ

Resource Writing Dept Dept. Dept. ration
Dept. Dept Dept.

Staff Staff Staff Staff Staff Staff

Fig :Organizational Structure of Premier Insurance

 PROBLEM IDENTIFICATIONS

Unhealthy Competition
One of the main problem that is faced Premier Insurance Company Limited is unhealthy
competition in the market. In context of Nepal non-life insurance have unhealthy competition
within them. Each of branch of premier insurance company limited isn’t glad if one of
branches does better.IT is one of the major issue seen in the branches of premier insurance as
well as other non life insurances.
A lack of faith
This is one of the reasons why many people refuse to buy insurance. Many insurance
companies fail to pay claims and refuse to admit to providing some benefits. As a result, most
people consider insurance to be an unnecessary expense. 
Lack of experts in Board and Departments
The major regulatory challenges of premier insurance company limited are lack of experts in
board and departments. Experts and qualified human resources if prerequisite for the
effective regulation of industry ,Insurance act doesn’t ensure the appointment and nomination
of the experts in the board.
Delusion of providing 100 percent insurance
In premier insurancfe company limited and other non life insurance companies , people have
the delusion that if they did insurance of for example motor or house insurance they think that
that they will get 100 percent of insurance of those things which is very much false.
Poor rural participation and low household investment
It is also found out that one of the main problem of the non life insurance is peoples
participation is very low and people don’t want to do insurance for their houses and spends
money on other things more.
Accessibility and lack of financial literacy
The insurance sector is less accessible to people in rural areas for a number of reasons,
including pricing and lack of awareness. An important step in the right direction would
involve increasing access to low cost and simple products, given the gap between pricing and
affordability. There is also a need to build trust and improve financial literacy among rural
populace to improve penetration.
Use of traditional products and distribution channels
insurance products are offered and marketed in traditional ways that make it tougher for
advanced insurance plans to gain Attraction. While online and point of sale channels are
slowly gaining popularity, the insurance sector also continues to rely heavily on traditional
distribution channels.
Paying high commission to agents
One of the problems that’s noted is insurances pays high commission taxes to the agents and
depending upon the policies and type of insurance and is not fixed by the government.
Findings
Finding is the process of investigation of information and data. It finds out something new
result by doing various research, survey and also using different kinds of tools and technique.
According to these report, some of the major findings are explained below:

 It is found out that more than 70 percent of profit is generated from motor insurance
in premier insurance company limited .
 The targeted customer is mainly corporate companies like banks and manufacturing
companies.
 The premier insurance companies use different types of portfolio
 The ultimate motive of non life insurance is to minimize the risk.
 It is mandatory by law to buy a third-party motor insurance policy. It can take care of
the compensation to be paid to the third party in case of damage to property or life.
 Home insurance covers the residential property of the policyholder against many
unforeseen incidents, like fire, burglary, natural calamities, riots, etc.
 . Any claim is not fully borne by the insurance company. The policyholder needs to
pay a small share, this share is called a deductible.
 Old customers are given more priority so that they would recommend and increase
numbers of new customers.
 Non life insurance like premier insurance company limited also involves in CSR
activities like donation in orphan house , pollution control activities etc.

POSSIBLE SOLUTIONS

Today the insurance industry is being radically reshaped by the record-setting pace of new
entrants, consolidation, and product commoditization. In this changing landscape, insurers
have to invent ways to offer more value than ever before. As is obvious, no insurance
company would want to battle inefficient operations that stem from disparate systems or
obsolete technologies underlying these systems or be saddled with aging legacy systems that
simply can’t accommodate the growing needs. Though there are problems in non life
insurances, there are several solutions that can be taken to overcome the prblems in the
future.

 Examine the client situation so that action can be taken according to their needs and
want.
 Explaining the plans and policies properly to the clients so that they will know exactly
about the insurance.
 Insurance companies need to build trust with their customers and establish faith in the
strength of their customer services
 Companies should show evidence of stability for customers to believe in them.
 Skilled and experienced market researcher also should be hired so that the company
can find out the pros and cons very accurately.
 Raise awareness on different non-life insurances plans and importances so that it
could reach in mass.
 Digitalize your non-life insurances for smooth management and easy configuration of
new products
 Proper client management should be done so that the insurers will be well informed
 Flexible design that can grow as the company grows.
 Giving more priority to old customers and through them making more customers

Recommendations with implications

Premier’s greatest strength is its people. In a business that begins and ends with people,
Premier’s human resources has huge responsibilities on it’s shoulders. Regularly trained on
the latest technology, Premier’s staff provides efficient service to its customers. They are also
trained on developing innovative and custom-made products, better risk management
solutions and quality service for maximum security to customers.These are some of the
factors that is recommended to the organization.

 Premier Insurance needs to update the existing technologies for high efficiency and
effectiveness of Insurance’s performance.
 Job rotation and job enlargement should be considered by the Insurance so that the
human resources will not feel monotonous working in the same place.
 Adequate training should be provided to the staffs about latest technologies and use of
computers.
 It is to highly recommended top the insurance to use the relevant benchmark to
measure the performances.
 Follow up of customers should be done on timely basis