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Transcript of MIS Project R.B.
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A
Project Report
On
Use of information system solution for efficient operation:- Case study on ICICI LombardSubmitted towards the partial fulfillment of
IIIrd Sem M.B.A. (Insurance)
Degree course, for the subject
Management of information system
Submitted by: Submitted to:
Ram babu Parihar Dr. Manmeeta
M.B.A. (Insurance) Associate professor and
IIIrd Semester asst. dean
Roll no. 231
NATIONAL LAW UNIVERSITY, JODHPUR
2010
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CONTENTS
SERIAL NUMBER CHAPTERS PAGE
NUMBER
Title
Research methodology
Information system 3
CHAPTER-1 Challenges facing by insurance industry 4
CHAPTER-2 Case study on ICICI Lombard 7
CHAPTER-3 Profile of ICICI Lombard
Challenges before ICICI Lombard
Information system solutions
CHAPTER-4 Conclusion 18
CHAPTER-5 Bibliography 19
Title: -
Use of information system solution for efficient operation:
:- A case study of ICICI Lombard
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BROAD AREA OF RESEARCH:
Role of Information system in General insurance business.
Research methodology
Data collection
Data collection techniques
The data used in this proposal is Secondary in nature and is in the form of various
publications of foreign bodies, books, magazines and newspapers, reports prepared
by research scholars, news documents and other sources of published information.
INTRODUCTION:
INFORMATION SYSTEMS:
Information system in a broad sense is used to refer to the interaction between
people, processes, data and technology. Hence the term refers not only to the
information and communication technology but also to the way in which people
interact with this technology in support of business processes.
Challenges facing by insurance industry:
Challenges are mounting for insurers. Increased pressure for profitability translates
into a hard look at cost reduction and top-line revenue growth. Profitability is
linked to the ability to accurately assess risk and manage customer relationships
over time to achieve financial success.
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With the arrival of private sector insurers with the partnership of multinationals
players the indian insurance space consisting of around 45 players both in general
life insurance industry. Today , life insurance penetration in india is around 4.75% ,
and 0.60% of general insurance. Still non-life insurance has very low penetration.
The Current Challenges to Underwriting Excellence:
As insurers continue to strive to reduce costs and capture profitable market share,
the limitations of their current processes, applications and infrastructure prove to
be major obstacles in fulfilling organizational strategic objectives. Most insurerscontinue to process business using Policy Administration platforms that are unable
to accommodate many of the industry stated business needs such as speed to
market, sophisticated underwriting and imbedded compliance using low costs
processes. They are inadequate because they were never designed to address these
current requirements and regrettably many are built using inappropriate
architectures and code that prove to be too inflexible to easily change. Policy
Administration systems have largely fulfilled a risk registration and accounting
data capture function. Many are now purely a conduit to other applications that
serve a functional requirement and many are being phased out as a consequence of
rationalization and their inadequacy in servicing current and future business needs.
When addressing a wide spectrum of business, channels to market are diverse as
are the processes. Typically, about 50% of business is transacted through
intermediated channels and the remainder through direct channels. The nature of
business transacted will span from simple to complex risks, which translates to
underwriting based on pre-defined rules to specialty risks requiring underwriters'
attention. Non intermediated business continues to increase as customer self
service grows in popularity owing to both customer demand as well as insurer4
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encouragement. Addressing the diverse nature of channels is another key
challenge for insurers.
As a result of geographical expansion of insurers, a third challenge faced is the
nature of trading to a wider variety of target markets.
Solution for efficient underwriting:
Mature markets are saturated and most insurers are adopting strategies that
differentiate their products and target market segments to win customer sets from
competitors. This drives a need for more product sophistication and quality market
data. Imbedding knowledge and compliance into the underwriting process using
electronic rules will substantially enhance control, increase automation and lower
operational costs Speed of service improves, as can the quality of customer
interaction which assists retention.
The opportunities for IT vendors and business transformation
consultants are immense, but to design and deliver future proofed
systems that support optimized operational efficiency is a
challenging task. The challenge for vendors is development of
tools that realistically enable capture and deployment of unlimited
complexities of knowledge into e-trading systems. Now insurers
are gradually identifying vendors for web based solutions, and are
gradually moving onto advanced platforms. Insurers are
substantially adopting information system as a backbone.
Distribution challenges:
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The Distribution Challenge
India is arguably one of the most challenging and promising emerging insurance
markets. Its rapidly growing economy, plus a young and huge population spellample opportunities for the development of insurance. There is however much to
be done to realize this potential. A few challenges to be tackled would be to
improve insurer solvency, raise a standard among insurance practitioners, asset
management capabilities, distribution challenges, operation risk mitigation etc.
More than 50% of Indias population lives in tier II-III cities and in rural India.
While tied agents continue to play an important role in distribution, alternative
channels like corporate agents, brokers are starting to play a greater role in
distribution. In spite of these intermediary , penetration is very low. There is need
of more efficient distribution channel to cover up society.
Solution for efficient operation :-
More than 50% of Indias population lives in tier II-III cities and in rural India.
While tied agents continue to play an important role in distribution, alternative
channels like corporate agents, brokers etc.
The penetration of commercial banks in India is unmatched, and no
form of agent led sales-force can compete with it. There are around 68,500
branches of scheduled commercial banks. Each branch serves an .Banks therefore
provide great potential to be tapped.The fastest and the most cost effective way to
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target this segment would be by selling insurance policies through their local
banks. Low cost to acquire and process customer applications. Bancassurance
provides one of the lowest cost per transaction.
Bancassurers should plan a technological infrastructure that will exploit
customer information found in the bank's database to uncover sales opportunities
and produce transactional simplicity for insurance customers.
The information banks have about their customers' buying habits, economic status
and money management practices constitutes a valuable asset often unrecognized
even by large, sophisticated banking institutions. Using technology to order
information about the economic behavior of customer segments can provide
valuable insights about insurance-selling opportunities. For instance, customers
buying a home through a bank mortgage can be approached for a variety of
insurance products. With a traditional insurer, behavioral information about
policyholders is usually unavailable, but even when known, can only be employed
by agents (who have an economic interest in thwarting a direct relationship
between the company and the client).
E-Brokerage:
Banks can open or acquire an e-Brokerage arm and sell insurance products from
multiple insurers. The changed legislative climate across the world should help
migration of bancassurance in this direction. The advantage of this medium is scale
of operation, strong brands, easy distribution and excellent synergy with theinternet capabilities.
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Case study on ICICI lombard
ICICI Bank Limited
ICICI Bank is India's second largest bank with total assets of over Rs. 1 trillion, a
network of about 540 branches/offices and over 1,000 ATMs. ICICI Bank offers a
wide range of banking products and financial services to corporate and retail
customers through a variety of delivery channels.
Through its specialised subsidiaries and affiliates it offers services in investment
banking, life and non-life insurance, venture capital, asset management and
information technology. ICICI Bank's equity shares are listed in India on stock
exchanges at Chennai, Delhi, Kolkata, Vadodara, Mumbai and the National Stock
Exchange of India Limited.
Its American Depositary Receipts (ADRs) are listed on the New York Stock
Exchange (NYSE) - the first Indian company and one of the first banks/financial8
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institutions from Asia to be listed on the NYSE. ICICI Bank is the only Indian
company to be rated higher than the sovereign rating by Moody's.
Lombard Canada Limited
Lombard Canada Limited is responsible for the insurance management services for
all of the Lombard Group's commercial, personal, and specialized insurance
companies. Exceeding $500 million in annual sales, Lombard Canada Limited also
provides insurance management services for external clients including the Tokio
Marine & Fire Insurance Company Ltd.
Lombard General Insurance Company of Canada underwrites commercial lines
business through select brokers across Canada. Lombard General brokers have
access to one of the industry's most powerful underwriting tools: Business Choice
, a specialized point of sale software developed by Lombard Canada. Beyond
providing small and medium sized businesses with the specialized insurance
coverage they require, Lombard General also offers custom marketing services and
specialized coverages designed to meet the needs of businesses across the country.
ICICI Lombard General Insurance Company
ICICI Lombard General Insurance Company Limited is a joint venture between
ICICI Bank Limited, India's second largest bank and Lombard Canada Limited,
one of the oldest property and casualty insurance companies in Canada.
ICICI Lombard has the guidance of Lombard, Canada, on domain knowledge,
product innovation, business processes based on cutting-edge technology and
international best practice in the insurance business. The company offers a wide
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range of retail and corporate general insurance products for today's challenging
business environment.
Challenges before ICICI Lombard
At the turn of the century, the explosive growth of the BFSI segment compelled
ICICI Lombard to look into ways of fending off the increasing competition.
Customers were demanding lower rates and with an increase in demand, the
industry had to respond with solutions that would allow them to sustain margins
without losing In addition to the increased competition, a complex network and
vast geographical presence made it difficult for ICICI Lombard to keep its spendunder control. The organization attributed nearly 80 percent of its spend to
complex indirect expenses like IT, marketing, printing and stationery and
infrastructure and it needed a way to streamline purchasing practices across varied
categories, as well asmanage suppliers more efficiently.
Claim management problems : Claims are not paying in proper time . It takes
longer span of time to compensate. Lack of proper communication between insurer
and insured leads to claims delayed. Investigating, paying and recording claims
data is crucial to any insurance company's financial stability. Without Information
system it is very onerous task to perform well or compensate timely.
Payment information: Perhaps the most essential area requiring accurate and
efficient information technology is an insurance company's client payment details.
Billing and invoicing systems generate the necessary revenue to keep the company
in business. Cash flow remains vital to daily operations and without superior
information technology and processing systems, the carrier's financial stability is at
risk.
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Policy details : For those insurance companies providing policies across multiple
lines of insurance, information technology requirements become even more
complex. Details of each insurance policy, ranging from life, home, auto, boat,
liability and business products, need to be accurately recorded and merged with
client data.
Information system solution for efficient operation:-
The IT group at ICICI Lombard is structured for quick response to a dynamic
market place. The approach has been to adopt a customer-centric strategy with
greater speed, higher accuracy and with enhanced capacity that is aligned with
organizations goals and objectives.
The following are the milestones in information system:
Best IT implementation award - ICICI Lombard has been awarded the Best IS
implementation award in the 'Maximum Business Impact' category for its GISbased Risk Management System initiated on August 2004.
Online Manager - a web-based interface enables our customers and intermediaries
to independently process insurance transactions through the internet. ICICI
Lombard has sales and service abilities on the corporate website, providing real
time policy issuance for certain products.
Improved speed and accuracy of claims processing using Talisma - A
Customer Relationship Management (CRM) system and Claims Processing System
(CPS) system have been implemented on the Talisma platform. ICICI Lombard has
integrated the contact center for surveyors, dealers, operations, internal claim teams
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into a single interface leading to improved speed and accuracy of claims
processing.
Deployment of Citrix MetaFrame Presentation Server for faster customer
service, tracking and monitoring of policy related issues at any time - In order
to cater to the diversity of locations at ICICI Lombard and a high volume of
transactions, there was an acute need to centralize applications for faster rollouts.
The company partnered with Wipro Infotech to implement a solution using Citrix
MetaFrame Presentation Server. Now, ICICI Lombards insurance employees and
agents are now able to structure all types of the companys insurance products,
independent of time and location. The system is designed to generate a policy in
less than 10 minutes.
ICICI Lombard signed up for Consigntech "GoDB Platform" for developing
mobile and disconnected POS (point of sale) - ICICI Lombard signed up for
Consigntech "GoDB Platform" a software from Consigntech for developing mobile
and disconnected POS (point of sale). This reduces the transaction cycle time for
policy issuance to its customer at the intermediary and customer premises. As the
processing gets distributed, the infrastructure required is reduced.
ICICI Lombard IS PathFinder - To align the organization with the growing
pace of economic development and expansion, ICICI Lombard has incorporated a
cutting edge IS application called PathFinder as its core policy administration
system. It is a state-of-the-art system that provides an efficient method to quote,
issue, manage policies and critical insurance functions from the internet as well as
the intranet. The system is based on the top-of-the line hardware infrastructure to
ensure its ability to handle the business growth.
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CUBOT delivers performance management to ICICI Lombard
Robust Designs implemented a CUBOT based solution that comprised of:
fully automated data aggregation saving time (approx. 20
person days each month) and eliminating errors completely
customizable dashboards that are role-based
atomic level drill-down analytics product, customer,
policy, claim level
intuitive user interface - in the form of graphs, charts and
tables
The CUBOT solution is an Executive Decision Support System that is activelyused by operational and senior managers at ICICI Lombard.
ICICI Lombard Insurance Services Implements Talisma v6
CRM
Insurance giant sets new level in customer service with multi-channel Customer
relationship Management solution from Talisma(TM), a leading provider of multi-
channel CRM solutions, its solution has been deployed by ICICI Lombard, a
leading provider of customized insurance solutions. Talisma V6 provide ICICI
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Lombard's customers with enhanced customer service through quicker and more
accurate claims processing.
This interaction includes contact information, customer profiles, appointments, and
service requests, regardless of communication method (chat, email, or phone). The
improved speed and accuracy of claims processing, powered by Talisma v6, has
led to increased customer retention rates for ICICI Lombard.
Implementation of Talisma v6 has allowed ICICI Lombard to map its internal
claims processes, eliminating the need for call center agents to process and forward
each document individually to the company's Claims Managers. Once information
has been input to the system and verified, Talisma v6 records the details of each
claim and assigns the claim to the organization's operations team for payment. This
new integration permits agents to manage claim requests quickly and accurately
saving time by incorporating information from a range of back office systems into
a single interface.
From a marketing perspective, Talisma's v6 enables ICICI Lombard to proactively
build customer relationships through targeted outbound campaigns. Contact
databases can now be integrated into the CRM solution, providing staff with
campaign management tools. This ensures that each contact receives the correct
outbound communication, thereby dramatically increasing customer acquisition
levels.
"Improving customer retention and acquisition is vital in today's competitive global
insurance market. We have helped ICICI Lombard reduce the complexity and time
spent on each claim by eliminating the need to process information from a variety
of back-end systems,"
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Citrix Solution for Workforce Mobility:
ICICI Lombard partnered with system integratorWIPRO to implement a solution
using Citrix Presentation Server running on HP ProLiant 380 and Dell 1750
Servers. Citrix technology has helped to maintain and consolidate our
competitiveness in the marketplace. Our employees enter our system through a
WAN, broadband internet, and dial-up and access the advanced end-to-end policy
issuance framework, including customer profiling, quotation processing, policy
issuance and payment process. The system is designed to generate a policy in less
than 10 minutes.
Improved System Administration Generates Cost Savings
Citrix solution, ICICI Lombard has seen a significant reduction in process and
administrative costs. These savings come largely from the centralized
administration inherent to using Presentation Server, which enables IT staff to
deploy, manage and update users systems without needing to be at the location of
the end-user. Said Mr. Motwani, Our high travel costs were eating into the bottom
line, but now our total reduction in the travel component is 70 percent, which
means an annual saving of about Rs. 10 lakhs.
Better Customer Service for Competitive Advantage
Another major benefit of the Citrix solution is improved business efficiency, which
translates to faster close-of-sale and higher customer retention. Since employees
are able to access the most up-to-date information and applications on-demand
from one of the companys multiple offices or on the road they can provide
clients with needed information instantly, on the spot. The new infrastructure
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technology infrastructure will be the backbone to attempt anything in this area. At
an appropriate time the company is also looking at M-powering our sales force
with mobile applications using GoDB."
About Ariba
Ariba, Inc. is the leading provider of spend management solutions to help
companies realize rapid and sustainable bottom line results.
ICICI Lombard began to evaluate options to regulate spend and build efficiency
within the organization. The organization chose Ariba to implement its spend
management solution.
Ariba Sourcing Execution Services were initially deployed to address two large
spend areas, print and infrastructure. The objective was to target high savings and
establish a proven sourcing process within ICICI Lombard. Ariba Sourcing -
Basic was then deployed across all departmentsincluding multiple vendors
across different locationsto help them to leverage a larger supplier base, reduce
overheads and increase its bottom line. The Ariba spend management solutions
have provided clarity into spend, extension of the supplier base and assistance with
negotiating purchaseswhich has created an efficient system for overall purchase
management for ICICI Lombard. Now when the company purchases indirect
supplies, such as office equipment, it is spendingon average21 percent less
than before. The Ariba solutions have also provided valuable information on fact-
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based negotiations, including capturing critical pricing and supplier data while
bidding took place.
Conclusion:-
By using the information system ICICI has got tremendous position among rivals .
The information system aided in following mechanism:-
Easy availability of policy details
Cost effective management
Quality service
People awareness about the products of a company etc. are the advantages of
implementing information system.
BIBLIOGRAPHY:
www.medindia.net
www.objectwin.com
http://www.ciol.com/images03/icici.pdf
http://www.icicilombard.com/
http://www.ariba.com/pdf/ICICILombard.pdf
http://www.ciol.com/images03/icici.pdf
http://www.domesticpartnersguide.com
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http://www.medindia.net/http://www.objectwin.com/http://www.ciol.com/images03/icici.pdfhttp://www.icicilombard.com/http://www.ariba.com/pdf/ICICILombard.pdfhttp://www.ciol.com/images03/icici.pdfhttp://www.domesticpartnersguide.com/http://www.medindia.net/http://www.objectwin.com/http://www.ciol.com/images03/icici.pdfhttp://www.icicilombard.com/http://www.ariba.com/pdf/ICICILombard.pdfhttp://www.ciol.com/images03/icici.pdfhttp://www.domesticpartnersguide.com/ -
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http://www.domesticpartnersguide.com
Page No.31/ Article Business Connectivity Insurance times /june210
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http://www.domesticpartnersguide.com/http://www.domesticpartnersguide.com/