CHAPTER – III

PROFILE OF OICL

Introduction

“The oriental Insurance Company Ltd, was incorporated on 12th September 947

at Mumbai. The company was a subsidiary company of Life Insurance Corporation

os India (LIC) from1956 to 1973. After that the General Insurance business was

nationalized in India in year 1973. The full shares of the company had been held by

the General Insurance Corporation of India (GICI) in 2003, and were transferred to

the Central Government. Oriental Insurance made a grand beginning with a first year

premium of Rs.99946 in 1950. 1. Indian & 12 foreign insurance companies were

merged with the OICL in 1973.The Company is a pioneer in laying down systems

for smooth and orderly conduct of the business. The company specializes in devising

special covers for large projects like power plants, petrochemical, steel and chemical

plants. OICL has rendering its services with its head office at New Delhi; it has 30

regional offices and nearly 1800+ operating offices in various cities of the country.

The company also has overseas operations in Nepal, Kuwait and Dubai and has a

total strength of around 13500 employees. It starts its business from less than a lakh.

It got a rapid growth went up to the gross premium of Rs.58 crores in 1973 at the

end of the year 2017-18 the premium stood at Rs. 11452 Crores.” 1

3.1 OBJECTIVES OF OICL

o “To ensure that act as a financially sound corporate entity with high business

effects.

o To implement best human resource development practices to build a highly

efficient, dedicated and motivated workers with high moral and moral values.

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 o To ensure that the employees optimally utilize the information technology

infrastructure.

o To provide prominent and excellent customer service.

o To run the business with high profitability through prudent underwriting and

efficient proper claim management system.

o To ensure the effective management of reinsurance operation.

o To manage their investments effectively to get maximum yield.

o To provide effective risk management system.

o To improving the penetration of non-life insurance through proper

underwriting, innovation and marketing.

o To evolve as a vibrant and dynamic leading non-life insurance company.”2

3.2 MANAGEMENT STRUCTURE OF OICL

‘Oriental Insurance Company Ltd is a professionally managed independent

Board-run company. Illustrious personalities like Shri.T. A Pai (who later became

Cbinet Minister in the Union Government), K. R. Puri, who rose to be the Governor

of RBI and Shri. B.D. Pande, who later became the Gevernor of West Bengal were

among our past chairmen. The Board of Directors of the company includes eminent

personalities in various fields. The company has a team of Board of Directors which

consists of a perfect blend of experts from the field of banking & Insurance. The

management structure of the company consists of chairman, Managing Directors,

Directors, General Managers, Financial Adviser, Chief Vigilance Officer, Appointed

Actuary, Company Secretary and Chief Financial Officers.”2

3.3 BOARD COMMITTEES OF OICL

The Oriental Insurance Company appoint various committees to manage and

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overseas the operations of the company. Those Committees are appointed as per the

companies Act 2013. The details of the committees are as follows.

3.3.1 Audit Committee

“The audit committee was setup for the board to overseas the financial

statements and financial reporting before submission to the Board It also the internal

audit function and its related work. During the financial years the committee met

seven times.”3

3.3.2 Corporate Social Responsibility Committee

“The Corporate Social Responsibility Committee is appointing by the Board

of Directors to promote the culture that emphasizes and setup high standards among

the employees and in the organization. The role of Corporate Social Responsibility

Committee is formulating and recommending the policies and activities to be

undertaken by the company to the board. It also recommending the amount of

expenditure to be on the activities undertaken

The Audit committee oversees the financial reporting before submission to the

board. It also managing the internal audit function of the audit committee of OICL is

overseeing and controlling the public funds are used efficiently and effectively.”3

3.3.3 Investment Committee

“The composition of investment committee is in accordance with the

provisions of the IRDAI(Investment) Regulations 2000. It is amended and the

guidelines are issued by IRDAI from time to time. The main role of this committee

is perform all the day-to-day work of managing the corporation‟s investment

portfolio whereas the investment committee is responsible for planning and oversight

the investment decisions, policies and procedures, to achieve the investment

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objectives.”3

3.3.4 Risk management Committee

“The Risk Management Committee was constituted in accordance with the

guidelines on corporate Governance issued by IRDAI. The function if this

committee is for monitoring and approving the risk management framework and

associated practices of the company. The members of this committee is as follows:

3.3.5 Property Review Committee

This committee of the Board was constituted in term of the directives received

from the Ministry of Finance to review the matters of properties held by the

company and other Estate related matters.

3.3.6 Remuneration Committee

This Committee was setup to evaluate the performance of the chairman –

cum- managing director, for payment of performance linked incentives as directed

by the Department of Financial series.

3.3.7 Information Technology Committee

This committee was constituted to give more focus to the information

technologies initiatives of the company and also to ensure that the 17 initiative are in

tune with the business objectives.

3.3.8 Appeal and Memorial Committee

The sub-committee of the Board has been prescribed as the Appellate

Authority and the Authority for Memorial For certain categories of employees/cases.

This sub-committee was constituted according to the consequent upon the

amendment of General Insurance Rules, 1975, which was duly approved in the 351st

Board meeting. The General Insurance Rules 1975 is now replaced with The

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Oriental Insurance Company Rules 2014, which was duly approved by the 419th

Board meeting of OICL.”3

3.4 ORGANISATION STRUCTURE OF OICL

CHAIRMAN – CUM MANAGING DIRECTOR (1)

DIRECTORS (6)

GENERAL MANAGERS (7)

FINANCIAL ADVISORS (1)

CHIEF FINANCIAL OFFICERS (1)

CHIEF VIGILANCE OFFICER (1)

APPOINTED ACTUARY (1)

COMPANY SECRETARY (1)

“The organization structure of OICL consists of 980 business centers in

serviced semi urban and rural locations to meet the obligation of the society and to

increase the insurance penetration. 28 Service Centers and 43 third party Hubs, are

dedicated to the service of insuring public of India. Along these offices there are

12593 staff members including 325 Marketing Officers, 659 Development officers

and also a story force of 40,588 agents are helping to consolidate the strong

foundation for balanced growth and profitability.”4

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3.5 FUNCTION & OPERATIONS OF OICL

The OICL separates its functions according to several departments. The

operation and function of the various departments of OICL are as follows.

3.5.1 Marketing Department

“The marketing department oversees the work forces who are working

towards the marketing of different policies introduced by the company. There are

Individual agents, corporate agents, Brokers are working together to achieve the

marketing goal of the company. In the year 2017-18 the total number of offices

reached to 1943. There are 659 development offices are working to perform the

marketing activities. The company has increased efforts in further empowering their

agency force by facilitating them to work on company portal (online).”5 The channel

wise performance of marketing department is as under.

Table 3.1

Performance of Marketing Department of

OICL in 2016- 17 & 2017-18

Premium (in crores) % to co premium

Channels 2016-17 2017-18 GR% 2016-17 2017-18
Individual agents 4800 5257 9.52 44.43 45.90

Corporate Agents – banks 309 265 -14.24 2.86 2.31

Corporate Agents - others 81 90 11.73 0.75 0.79

Brokers 2072 2430 17.28 19.18 21.22

Direct selling 3533 3345 -5.33 32.71 29.21

Web Aggregator 8 64 732.25 0.07 0.56

Total 10803 11452 600 100 100

Source: Annual reports of OICL 2017-18
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 The above table clearly states the performance of Agents, brokers and others.

The 6 Divisional offices have been designated as Corporate Business Units (CBU),

and they contributed a premium of Rs.411crores with a growth rate of 16.43% in

FY- 2017-18.

Bancassurance Channel

Banc assurance means Insurance through banks. This channel contributes

Rs.265 crores as premium and efforts were made to upgrade and revise the existing

products to align with the contemporary products in the market. This will bring

additional Revenue to the company in the next year.

Pradhan Mantri Suraksha Bima Yojana (PMSBY)

“Under this scheme the company has tied up with 215 banks all across the

country for implementation of Pradhan Mantri Suraksha Bima Yojana. In 2017-18

the company earned premium of Rs.17.58 crores by this scheme, with a growth rate

of 35.65%. The total lives covered under this scheme are 1.47 crores and 1471

claims were settled.”6

Performance of the Business Caters

The business centers of OICL have been a good source of retail business over

the last many years with healthy ICR and low management expenses. Rs.808 crores

of premium has been collected from the 980 business centers with a growth rate of

20.05%.”5

Portal and Online Selling

“Web portal of the company continues to provide efficient service to the

customers and agents of the company by fulfilling the promises of “Insurance online

– any place any time”. The company generated a premium of more than Rs.92.13

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crores with 1.93 lakh policies in 2017-18 through web portal. The mobile application

is also launched for the customers.”5

Rural Sector Premium and Social Sector Performance

“The company maintains their services towards Rural Sector and Social

Sectors. In the year 2017-18, the contribution of rural premium to the total was

15.93% well above the statutory requirement of 7%. In social sector the company

gives protection to crores of lives during the FY 2017-18. The total Gross Premium

underwritten is Rs.11451.97 crores in 2017-18 whereas it is Rs.10803.34 crores in

2016-17. Among these the social sectors achieved Rs.1.93 crores in 2016-17

whereas. in 2017-18 it is Rs.7.08 crores. In rural sector the premium collected was

Rs.1823.91crores and Rs.1542.61 crores respectively”5

3.5.2 Human Resource Department

Human resource is the main source of value creation. The HR department is

back-bone of every business organization. Here also it proves that by providing

continuous support for improving organizational efficiencies. “The department

continued with rebuts HR activities and process of performance management to

improve motivational levels of workers, and enhanced commitment levels and

helped further building in house technical expertise. The company is in continuous

process of recruitment and talent acquisition to manage the organization‟s expansion

plans and to recruit specialized and skilled workforce to equip operational offices for

meeting the market challenges. The department is also put their efforts to ensure the

fair and relevant decision making in HR related policies, legislation, reservation and

practices.”6

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Promotions and Trainings

The department oversees the promotional activities of all the employees and

performed well by complete the entire promotion exercise on schedule. The number

of employees promoted during the year 2017-2018 is as follows:

No. of Promotions
Cadre Promoted
declared
Scale I to Scale II 329
Scale II to Scale III 192
Scale III to Scale IV 106
Scale IV to Scale V 39
Source: Annual reports of OICL 2017-18

“Welfare matters for SC/ST Employees also managed by this department in

accordance with the policy of the Government of India. A Reservation cell is

actively and efficiently functioning in the company at Head office to ensure that the

Rules and regulations on Reservation policy are implemented in accordance with

constitutional provisions.”6

“The company organizes pre-recruitment and pre-promotion Training

programs for SCIST candidates. In order to develop their skills, they are nominated

to various in-house, in-service training programs as well as programs conducted by

the renowned agencies.”6

Recruitment

„The HR department has been taken over the recruitment process by a

cautious approach with the twin objective of catering to need for the organization

and increase in per employee productivity. The HR department conducted a

recruiting process during the year 2017-18, by which 300 direct Administrative

officers were recruited and postings are likely to be made in the next quarter.”6
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Human Resource Management System

„The HRMS is functioning in the Company and has made a real impact

during 2017-18. This system provides some vital modules like Attendance

Management, Pay-Roll Administration and provident fund. These modules are in

complete use and facilitating effective and automated HR administration. The

company is capable to provide diversified stakeholders in a economical way with the

improved and updated HRMS module.

Besides the HRMS has already providing information to the management in

respect of workforce, and it should be definitely immense help to the management if

all the modules of HRMS are implemented. This is a tool in the hands of

management for implementing corporate decision regarding the human resources.

HRMS has brought economy of efforts, accuracy and cost effectiveness and no paper

work in the process. Lately, Human Resource Management System has been

automated for APAR for officers in the cadre of scale-I to 4 in the financial year

2017-18.”6 The workforce under HR department of the company during the study

period of 10 years as follows:

Table No 3.2

No. of workers in OICL

Years No. of employees

2008-09 15553
2009-10 15433
2010-11 15190
2011-12 14742
2012-13 14675
2013-14 14574
2014-15 13923
2015-16 13923
2016-17 13667
Source: Annual reports of OICL

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 The total number of employees from 2008-09 to 2017-18 are in decreasing

trend. It shows that the company taking steps to reduce the employees by using

HRMS modules.

3.5.3 Accounts, Budget & Taxation Department

The Accounts, Budget and Taxation department is functioning under the

head of General Manager of Accounts, Budget & Taxation Department.The

Accounts of Oriental Insurance Company is maintained as per the guidelines of

IRDA through the General Insurance Company.

As it is one of the GICI the accounts are maintained in the pattern of all other

insurance companies of GICI. They prepared Final accounts, Revenue Accounts,

Fund flow statements, Cash flow statements and the supportive schedules of various

items in the final Accounts. The main Accounts prepared in the company are as

follows.

1. Revenue Accounts

2. Profit and loss Accounts

3. Balance sheet

4. Cash flow statements

5. Schedules

Revenue Accounts

The property insurance segment of the company continued to witness intense

competitive pressure, tough market conditions and stunted business growth.

However the company has to manage risk against the property loss due to fire to its

policyholders. The fire policy was introduced by the company provide safety and

security to the public and business organization‟s properties. The three segment‟s

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revenue accounts show the following results during the ten years of the study

period.”8

Table: 3.3

Results of Revenue Accounts of OICL IN 2008-09 AND 2017-18

(Rs. in crores)

Years Fire Marine Miscellaneous Total

2008-09 -87 -23 -286 -397

2009-10 3 20 -217 -94

2010-11 -21 -21 -200 -242

2011-12 -64 9 71 10.07

2012-13 114 35 255 404

2013-14 -21 69 156 204

2014-15 -25 117 -0.47 92

2015-16 -137 0.32 - 376 -512

2016-17 -112 33 - 2322 -2400

2017-18 -11 113 1025 1148

Source: Annual reports of OICL

Fire Segment

Historically fire has been a major cause of losses to property. OICL has

maintained Fire Segment to provide protection against such losses. Under the Fire

Segment policy is available to large business houses and godowns. The premium

has charged on differential rating system depending upon the hazard involved with

special provisions to extend cover to include damage due to fire. The following fire

products are available in this company:

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  Standard Fire and Special Perils Policy

 Consequential Loss(Fire) Policy/ Business Interuption(Fire) Insurance

 Industrial All Risk

 Mega Risk Policy

 Stand Alone Terrorism Cover

Marine Segment

The company established marine segment to take over the marine hull

insurance policies owned by the traders, operators and owners of vessels. Moreover,

in international trade, as markets are highly competitive and as profit margins are

very thin, so insurance is needed to protect risk otherwise a major loss wipe off a

trader from the business. The performance of marine insurance in OICL is better

than that of fire insurance business during the study period the OICL got notable

operating profit from marine segment. The Revenue Account of Marine insurance

shows the positive results only. The operating profit in 2017-18 is Rs.112.50 crores,

whereas in fire

segment it is only Rs.10.50 crores. But the operating profit is fluctuating throughout

the study period. The policies issued in this segment under two Categories likewise;

 Marine Cargo

 Marine Hull

Miscellaneous Segment

Except fire and Marine policies all the other policies are coming under the

head miscellaneous segment. The Miscellaneous Segment is the largest segment in

this company. Here the policies are provided for the purpose of public safety and

protection of their vehicles, life and health. Separate Revenue Account is prepared

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for Miscellaneous Segment and separate schedules also prepared for the following

classes of Miscellaneous Insurance according to the As-17. This segment consists of

the following classes of insurance.

 Motor

 Motor TP(non pool)

 Motor TP(pool)

 Motor TP (D.R.pool)

 Engineering

 Aviations

 Workman Compensation

 Personal Accidents

 Health insurance

 Liability

 Others

Profit & Loss Account

The profit and loss Accounts of the company has prepared for all the

segments together. The operating profit of each department has transferred to profit

and loss account. Depreciation, tax, and dividends like other provisions have

deducted to calculate net profit after tax of the company.

Balance Sheet

As per the accounting standard and rules and regulations provided by the

IRDAI, the balance sheet is prepared in the General Insurance Companies. The

Balance sheet has prepared as per the format prescribed by the companies Act 2013.

It is the statement of sources of funds and application of funds after adjusting the

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current Assets and Current liabilities.

Cash flow Statement

The company has also prepared the cash flow statement every year ending to

find out the cash balance exactly. It consists of cash flows from the operating

Activities, Cash flows from the Investing Activities, and Cash flows from Financing

Activities. All the cash inflows and out flows have properly adjusted and find out the

increase or decrease in cash equalent during the year. It has started with the cash &

cash equalent at the beginning of the year and ends with cash & cash equalent at the

end of the year.

Schedules

The schedules have prepared to support the financial statements. The

schedules have clearly defined the headings which have mentioned on the top of

every schedule. Generally, the following schedules have prepared in general

Insurance Companies.

Schedule for,

(i) Net premium Earned

(ii) Net Claims incurred

(iii) Commission paid

(iv) Operating expenses related to insurance business.

(v) Share capital & pattern of shareholding

(vi) Reserves and Surplus

(vii) Borrowings

(viii) Investments

(ix) Loans

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 (x) Fixed Assets

(xi) Cash and Bank balances

(xii) Advances and other Assets

(xiii) Current liabilities

(xiv) Provision

(xv) Miscellaneous Expenditures.

3.5.4 Income tax Service tax & GST Department

“The Accounts department also takes over the income tax calculations,

service tax and GST with the help of some specialized personnel‟s. The income tax

assessment for and up to the assessment year 2015-16 and service tax assessment for

and up to 2002-03 and for the FY 2008-09 to 2010-11 have been completed. During

the FY 2017-18 the company brooked an interest income of Rs.9849.04 lakhs on the

basis of Assessment Appear of earlier years. The company has implemented GST in

compliance to GST ACT, rules and regulation w.ef 01.07.2017.”7

3.5.5 Internal Audit Department

“The internal audit and Inspection department is functioning at the Head

office with the help of feedback made available by its 27 Audit cells which are

functioning at Regional centers have been able to provide information to the

Management. Every year the IAD has conducted regular Audit in its Regional

Offices, Divisional Offices, branch offices and its business centers. In addition to

this the IAD has been conducted regular Audit of all departments of its Head office

viz., Personnel & HRMS, Estate, Re-insurance Treaty, Re-insurance Accounts, IT,

Underwriting & Claims, Marketing, Marine Cargo & Hull, Moto(TP), Motor(OD);

Fire and Engineering, Health Departments etc.,

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 As per the IRDA guidelines the technical Audit of all the Regional offices have

been conducted on quarterly basis and the findings have placed before to the Audit

Committee or board.”7

3.5.6 Investment Department

The department deals with only the regulatory aspects of investment

functions of Oriental insurance Company. Generally the insurance companies deals

with the public funds. Therefore insurers rely on the trust of their policy holders.

Investment assets means all investments made out of shareholder‟s funds

representing solvency margin and policy holder‟s funds at their carrying value as

shown in its balance sheet drawn as per the IRDA.

“As per regulation 4(1) of the IRDA (Investments) Regulations act 2008,

every insurer carrying, on general insurance business shall invest and keep invested

their investment assets in the following manner,

Sl.No Types of Investments Percentage

1. Government Securities Not less than 205 of investment Assets.
Govt. Securities and other
2. approved securities incl. Not less than 30% of investment Assets.
above
Investments as specified in
sec 27B of the Insurance :

a) Approved investments
and other investments. Not exceeding 55%
3. b) Housing and loans to
State Govt for housing Not exceeding 5%
and firefighting
equipment.
c) Investment Not less than 10%s
infrastructure
Source: Annual Report of OICL 2017-18

The investment policy should be draw up by every insurer under the control

of General Insurance Act. This policy has to be submitted to the board of directors

69
for approval. The investment policy shall be implemented by the investment

committee and fund performance to the board. The company maintained Current

Investment, long-term investment & short-term investment, for accounting

purpose.”8 The total investment of OICL is divided into two heads, such as

 Shareholder‟s Investment

 Policy holder‟s Investment

Both the headings are also divided its investments as short-term and long-

term investment.

The Investment Department is only responsible for the investment policy and

its purpose, activities and performance.

3.5.7 Reinsurance Treaty Department

“The company also maintains the Reinsurance Treaty department to provide

protection to insurers against adverse impact of large losses on individual risks and

of catastrophic losses effect a large number of risks. It is a methodical way of risk

transfer which also provides automatic capacity to an Insurance company thereby

enabling it to underwrite risks beyond its Net retention and manage its risks

effectively. So that only the marketing team is in a safer side to accept business in

the present challenging market conditions and achieve its targets. The main aim of

the company‟s reinsurance program is to ensure maximum protection at minimum

outgo and to provide automatic reinsurance facility through a proper mix of

proportional and Non-Proportional Treaties.”8

3.5.8 Information Technology Department

“The IT setup at Oriental Insurance Company Ltd., Provides continuous

support to the management in business operations and the thrust continues to be on

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client satisfaction through IT enabled services. During the year 2016-17 deployment

of Enterprise Content Management (ECM) has been undertaken for achieving and

maintaining the documents in electronic form and their easy retrieval for supporting

the business operations. The ECM is being integrated with the core insurance

application of OICL and also with the web portal of the company which will enable

the operating offices to refer to the documents online so as to minimize the response

time in settlement of claims and facilitate improves services to the customers.

The company has received IT security setup and is in the process of bridging

the gap prevailing best practices of the industry to take utmost care of IT security

framework including endpoint and cyber security related issues. Oriental Insurance

Company has also formulated and adapted a comprehensive „Business continuity

and Management Policy‟ and „Cyber Crisis Management Policy‟. The company‟s

online sales continue to grow at on steady pace and now about one third of the motor

premium is received through online sales, it includes sales through the Web portal

and online insurance of policies at Dealer points/ Till ups/OEM/ integration with

web Aggregator & Broker portals. In the year 2017-18 the company‟s online sales

were Rs.850 Crores and over 15 Lakhs policies were issued online. It went up to

92% in 2017-18 over the premium financial year and the sales continue to grow at a

steady pace.

The online services have been extended through Mobile Application on

Android platform. This application provides for online insurance of new policies,

renewal of policies, and intimation of claims, Dashboard features, and upload of

claim documents, online payments through Credit cards, Debit cards, Net Banking,

E- Wallets, IMPS and UPZ. The major thrusting terms of IT implementation and IT

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enabled services will continue to be on providing efficient online services to their

customer and all the stakeholders. The digital footprint of Oriental has a significant

presence in the insurance domino and it shall be our constant endeavor to enhance

the digital interface in all spheres of our operations.”9

3.5.9 IRDAI Returns

IRDAI Returns are mandatory regulatory returns for submission of

department-wise data or information as per the given formats. These returns almost

cover all the facets of the company‟s operations and provide a clear picture of

the performance in terms of various products and lines of business. The required

Public Disclosures as mandated by IRDAI are also done through the company‟s Web

portal for information of the general public at large. Moreover, the monthly/

Quarterly/ half yearly/Annual data as per the specified format is also carried out

through the Business Analysis Project (BAP) portal of IRDAI in online.9

3.5.10 Vigilance Department

“Vigilance is an integral tool of management. It can be used for better

industrial relations and improved productivity. If the company has taken in the right

spirit the Vigilance can help the management in forgoing deeper bonds with their

employees, it results better industrial relation by avoiding disciplinary cases through

preventive vigilance. The Chief Vigilance Officer of Oriental Insurance Company is

Shri. M.P. Nagpal. The CVO visited ROs and other offices to sensitize the staff

members about the importance of being Vigilance Department has been able to

install a value system where people with modified intention have fear of vigilance.

Vigilance officers carried out surprise inspections and also educated the employees

on preventive vigilance and creating awareness among them for better

underwriting.”10

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3.5.11 Customer Service Department

This department is functioning under the head of Mr.Soumya Mukherjee.

The company has given the utmost importance for redresses of the grievance and

always keeps its mechanism well to meet the requirement of the customers. This

department looks over the complaints registered by the customers in the company‟s

portal. 99.78% of the registered complaints were disposed, showing an improvement

over the last year‟s performance which was 99.64%. The department further redress

The grievances that are registered in the centralized Public Grievance

Redress and Monitoring System and also recently introduced INGRAM portal, both

are maintained by the Govt. of India.11

3.5.12 Product Development Department

“The product development department takes over the product portfolio of

OICL. The company‟s vast product portfolio has been specially designed to serve

the needs of consumers in India. The company develops General Insurance plans in

the best interest of their customers. The company continues to provide customized

insurance products for all sections of the society at affordable prices. The various

insurance products available in OICL are as follows;

 Motor policies

 Health insurance

 Personal policies

 Accident Professionals

 Business/Office/traders/Multiperils

 Engineering/Industry

 Agriculture/Sericulture/Poultry Animals/Birds

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  Aviation

 Marine

In 2017-18 the company has revised its products in terms of new terms and

conditions. The product development department has designed and filed for IRDAI

approval for the following products in the financial year 2017-18;

 PNB- Oriental Royal Mediclaim -2017

 OBC- Oriental Mediclaim Policy -2017

 Engine Protect cover – an Add on to private car policy

 Pravasi Bharatiya Bhima yojana – 2017

 Restructured Weather Based crop Insurance Policy

 Oriental Super Health Top-up Policy

 Long term Two wheeler package Policy

Among the above products the company has got IRDI Approval for the first

five. It has been focused by the department to name the products in simple language

so that it is easily understandable by the customers.”12

3.5.13 Risk Management & Actuarial Department

“The Risk Management and Actuarial Department was implemented in the

year 2009 with only one officer, and now it has emerged as a fully developed

department with six officers. Thus this department has a strong team with requisite

technical competence and skills to take care the future requirements in terms of risk

management and actuarial evaluations.

The department has two types of activities viz, IRDAI mandated and other

risk management related activities. The important IRDAI mandated activities

performed by the department are as follows;

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  Estimation of liabilities like IBNR, PDR, Terminal benefits etc.

 Working out Economic capital requirement

 Preparation of financial condition reporting(FCR)

 Asset Liability Management(ALM)

 Product Performance Review

 Pricing support – new products and review of existing out.

 The department provides actuarial pricing support to the product

development department in respect of the following;

 RSBY pricing

 PMFBY & WBCIS

 Review of existing loss making products

 New “Revised products, including add-on covers.

In order to help the underwriting department to control the claim cost, the

Risk Management Department does a segment-wise and product-wise analysis of the

data and provides necessary inputs on product performance. The Risk Management

framework put their efforts to meet the challenges posed by the ever changing risk

landscape of non-life insurance. The frame work includes;

 New Risk Governance Structure

 Risk appetite Statement

 Risk Assessment Framework

 Risk Reporting Framework

 Risk Management Policy.”13

3.5.14 Training Department

The OICL is having a corporate training department to give innovative

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training to their employees. This department has been focused on introducing new

and effective training programs to promote talent management and personnel growth

of the management. The main objective of the training programs of the company is

to make the employees competitive, loyal and well equipped with appropriate job

skills so as to achieve the organizational goals. A large number of training programs,

seminars and workshops were designed and conducted during the year 2017-18, by

the company‟s in-House training, catering the present and future training needs of

this organization. The OICL have been given training to their employees in order to

get the exposure in different areas of training programs as per the four tier training

system consisting of

 Oriental Staff Training College, Faridabad and Chennai

 24 Regional Training Centers covering 30 Regional offices.

 National Insurance Academy- Pune.

 Other Professional Institutes like Institute of Actuaries of India, Insurance

Institute of India ICWA, Administrative Staff College of India, Hyderabad,

etc.14

3.5.15 Foreign Operations of OICL

“The company has its branches in Nepal, Kuwait and Dubai. The company

operates a branch model in Nepal while they have agency operations in Dubai and

Kuwait. It has been given license and authorization by QFCRA to commence

operations in Qatar. They have already put in place the required manpower as well as

infrastructure in anticipation of commencing operations. In 2016-17 the company

has achieved a foreign business of INR 312.10 crores and in 2017-18 it is Rs.262.11

crores, growing at a rate of -16.01%.”15 The performance of foreign operations of

OICL in 2017-18 is as follows

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 Table: 3.4

Performance of OICL in Foreign Operations in 2017-18

Nepal Dubai Kuwait Total

Particulars Amt Amt Amt Amt %

Gross Direct Premium 43.24 1980.85 50.74 284.83 -

Premium(Net) 42.63 169.18 50.30 262.11 92.02

Commission(Net) 0.38 51.53 15.88 67.79 25.9

Incurred Claim(Net) 32.07 110.49 65.45 208.01 9.36

Reserve Strain 0.17 -27.16 1.08 -25.91 -9.89

Management Expenses 10.64 6.50 2.65 22.46 8.57

Underwriting
-0.63 27.82 -84.76 -10.24 -3.91
Surplus/Deficit

Interest and other

8.64 1.77 1.45 11.86 4.52
Income
Net Surplus
8.01 29.59 -33.31 1.62 0.62
(+)/Deficit(-)

Source: Annual Report of OICL 2017-18

3.5.16 Estate & Establishment Department

Management of company owned property

“This department is focused on Modernization and maintenance of the

company owned and leased properties. The Head of the department is Mr.

AJITHKUMAR, General Manager has look after the functions of this department.

The department has taken a step to get all the leased Deeds of various Leased

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premises which are registered with appropriate authorities, so as to check the

litigation and property disputes in future.

Renovation of Office Premises

The estate department looks after the renovation and modernization of all the

offices, and provides favorable working conditions to all its employees. The estate

department boosts the brand image of the company and has made rigorous efforts in

this regards. The department has taken up successfully completed the renovation of

various operational offices across the country. The department is making all efforts

to utilize the non-conventional sources of energy to reduce stress on non-renewable

resources.

Construction & Redevelopment Projects

In continuation of the efforts, the estate department, Head office has

continued their good work in boosting the housing facilities available in the

company. It‟s also concentrate on the redevelopment projects of company owned

properties and construction projects on company owned properties.

Office Premises

This department has been maximizing its efforts through ensuring the timely

-renewal of lease agreements of all leasehold premises. This department also

maintaining the gainful utilization and income generation from company owned

buildings and the excess area occupied by the offices.”16

Swatch Bharat Mission

The department has created awareness amongst all of their operating offices

proper upkeep of offices. Cleanliness is maintained on regular basis, and the steps

have taken to dispose the old unusable furniture & old records. The department is

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focused on the company‟s „Eco Policy‟ and implementation of initiatives of

„Swatch Barat mission‟ as per the direction of the Central Government of India.

Right to Information

“The company is offering RTI facilities to their customers. It has been

dealing with RTI matters in more than one way. It facilitated ahead with

decentralization of the processing of the RTI matters AT Regional Offices level in

2009. The company started the first General Insurance PSU to go online ahead of

LIC and all non-life General insurance companies, The Sub Moto disclosures as

mandated under section 4 of the RTI Act have been placed on our website and are

regularly updated by us”17.

Subsidiary / Joint Ventures/ Associate Companies of OICL

“The Oriental Insurance Company Ltd. has one wholly owned subsidiary

company, which is, The Industrial Credit Company Ltd. Its paid-up share capital is

Rs. 5, 00,000 in 2017-18. 100% of the shares of this company are holding by the

OICL. The OICL has two Joint Venture associate companies namely,

1. Health Insurance TPA of India Ltd.,

2. India International Insurance Ld., Singapore.”17

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 Table: 3.5

Capital Structure of the Subsidiary and Joint Venture Associates

Companies of OICL -2017-18

Paid up Share % holding by

Sl. No Name of the company
Capital OICL
I Subsidiary
The Industrial Credit
Company Ltd.,
II Joint Venture Associate Rs. 5 Lakhs 100%
Companies:
Health Insurance TPA of
1. India Ltd.,
India International Pvt. Ltd., Rs. 70 crores 23.85%

2. Singapore SGD 5 crores 20%

Source: Annual Report of OICL 2017-18

The OICL includes all the operations of its subsidiary company with its

financial statements. Therefore, the performance of the OICL includes the

performance of its subsidiary company and its foreign operations too.

References

1. website of OICL-https://www.orientalinsurance.org.in –Profile

2. website of OICL-https://www.orientalinsurance.org.in –Our vision & Objectives

3. Annual Report of OICL 2017-18, Pg. No. 120-125

4. Annual Reports of OICL 2017-18, Pg. No. 62

5. Annual Report of OICL 2017-18, Pg. No. 61-67

6. Annual Report of OICL 2017-18, Pg. No. 69-73

7. Annual Report of OICL 2017-18, Pg. No. 85

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8. Annual Report of OICL 2017-18, Pg. No.89

9. Annual Report of OICL 2017-18, Pg.No.106-109

10. Annual Report of OICL 2017-18, Pg. No.110

11. Annual Report of OICL 2017-18, Pg. No. 112

12. Annual Report of OICL 2017-18, Pg. No. 114

13. Annual Report of OICL 2017-18, Pg.No. 92-94

14. Annual Report of OICL 2017-18, Pg.No. 116

15. Annual Report of OICL 2017-18, Pg. No.92-94

16. Annual Report of OICL, 2017-18, Pg. 99,100

17. Annual Report of OICL 2017-18, Pg.No. 101

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