WELCOME

TO

OUR PRESENTATION

PRESENTATION

ON

PRAGATILIFE

INSURANCELIMITED

INTR

ODUC

TION

&

COM

PANY

OVE

RVIE

W

Presented byAbu Saief Md Rahat Bhuiyan

COMPANY INTRODUCTION

With the motto “TRUST US for LIFE” Pragati Life Insurance Ltd. was introduced into the business market of Bangladesh on January 30, 2000. The company started it’s journey as a joint stock company under the companies Act 1994. The company started with a paid up capital of Tk. 30 million against an authorized capital of Tk. 250 million. Pragati Life Insurance Ltd. has been sponsored by some renowned business entrepreneurs of the country linked to different industrial groups. They are now the most repudiated insurance company in our country.

Vision

1.Want to be recognized as the leader among insurance companies in Bangladesh.

2.Their success will be built on their absolute dedication to the satisfaction of their policyholders.

3.They will always apply high standards of integrity and responsibility in their activities.

Mission

1.Their mission is to produce and provide qualitative and innovative insurance product.

2.Maintain ethical standard in business operation.

3.Ensuring benefit to the policyholders, shareholders and society at large.

Goal1.Earn profit in a way to cover the claims of the policyholders and a portion of profit share to the shareholders.

2.Provide the claims of the policyholders within times.

3.Serve the policyholders true satisfaction.

ObjectiveTheir objectives are to conduct transparent business operation based on market mechanism within the legal and social framework

MANAGEMENT TEAM

Managing DirectorMd. Jalalul Azim

ConsultantS R Khan

Additional Managing DirectorQuamrul Hasan

Deputy Managing Director

M. M. MonirulAlamAssistant Managing Director

Chandra Shekhar Das ACA, Finance & Accounts

A.K.M. Mozammel Hossain Belal

Al-Haj Md. Jahangir AlamHead of Takaful

Senior General ManagerK.A.S.M AzamUllahTipu

Head of Pragati Bima & Pragati Islami Bima Division

Al-Haj Faruque MahmudHead of IPL(Polash)

Jahangir HossainHead of IPL(Bakul)

Md. Azharul Islam MondalHead of IDPS

ORGANIZATION STRUCTURE

Additional Managing Director

Deputy Director

Managing Director

Consultant

Assistant Managing Director

General Manager

Deputy General Manager

Assistant General Manager

Senior Manager

Manager

GROWTH & PERFORMANCEPragati life insurance ltd. have achieved 187.57 crore gross premium in the year 2012. This achievement was possible by superior service quality, innovative products and good management. In the year 2012 life fund under review showed a growth of 22% over the previous year (2011). The total life fund stood at tk. 315.31 crore at the end of 2012 which is a great achievement of the company.

                  Taka in Million

 

    Growth   Growth   Growth   Growth   Growth  

  2008 with   with   with   with   with 

Year respect to 2009 respect 2010 respect 2011 respect 2012 respect 

  

 

2007 to 2008 to 2009

to 2010 to 2011 

            

    (%)   (%)   (%)   (%)   (%) 

                      

Life Fund 1058.86 33.25 1511.23 42.73 2119.10

40.22

2593.79

22 3153.14

22  

                    

                      

Gross Premium

736.47 29.28 1105.30 50.08 1795.22

62.41 1917.72 6.82 1870.57

(2.45) 

CAPITAL & EXPENDITURE

2012 2011 2010 2009 20080

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

3,000,000,000

3,500,000,000

4,000,000,000

4,500,000,000

5,000,000,000

Capital & Expenditure

Capital Expenditure

INSU

RANC

E PO

LICI

ES

& CO

NDIT

IONS

Presented byMohammad Ali

(Under this category contain 14 policy)

a)Plan 01-JIBON SATHI (with Bonus)

b) Plan 02- JIBON PROTTASHA (with Bonus)

c) Plan 03- JIBON TORI (with Profit)

d) Plan 04-JIBON SOMAHAR ( with Profit)

e) Plan 05- JIBON ALO (with Bonus)

f) Plan 06-JIBON BONDHU (with Bonus)

g) Plan 07-JIBON ABOKASH (Pension)

1.Individual product Line

Insurance policies of pragati life insurance policies Insurance policy of pragati life insurance can be classified into 4 basic categories .These are

2.Group insurance

h) Plan 08-JIBON BIKASH (Child Education)i) Plan 09- CORPORATE PLANj) Plan 10-JIBON UTTORON (Joint Life)k)Plan 11- JIBON PARASH (Health Insurance)l)Plan 12-JIBON SHONCHOI (Single Premium)m)Plan 13-Jibon Purnota (Hajj Bima) Islami Insurancen)Plan 14-Jibon Bondhonslami Insurance

It contains 4 categoriesa)Plan 01-Group Term Life (GT) b)Plan 02-Group Term Life Insurance with Refund of Premium c)Plan 03-Group Endowment Insuranced)Plan 04-Group Insured Provident Fund (GIPF)

a)Plan 01-Shonchoi 3-in-1 Policyb)Plan 02- - Shonchoi 3 payments Policyc)Plan 03-Shonchoi 4 payments Policyd)Plan 04- Sonchoisomahar policye)Plan 05- - Education Endowment Policyf)Plan 06-- DPS (Pension Policy)g)Plan 07-Jibon Sanchay

3. Health insurance

It contains 2 categories a)Plan 01-Individual Hospitalization Insurance Plan b)Plan 02- Group Hospitalization Insurance Plan

4. Pragatibima

RISK ISSUES OF THE COMPANY

Definition of Risk

Risk is a term which refers to the probable disadvantageous, undesirable or unprofitable outcome of a fortuitous event, an event which is not desired, but nevertheless taking place.

Types of Risk

Financial RisksThese are the risks where the outcome of an event can be measured in monetary terms.

None-Financial RisksWhen the possibility of a financial loss doesn’t exist,then the situation can be referred to as none- financial risk.

Pure RiskPure risk situations are those where there is the possibility of loss & no loss.

Speculative RiskSpeculative risk are those where there is possibility of gain as well as loss.Fundamental RiskThese are the risks which arise from causes that are beyond the control of an individual or group of individuals.

Particular RiskThe risks which usually arise from actions of individuals or even group of individuals.

a) Duration of policy b) Nature of Life Stylec) Statistics d) Probability of loss e) Frequency of loss f) Nature of insured

Risk Management Tools

Proper risk measurement tools are essential for all insurance company in order to face calculative risk. Pragati life insurance ltd. follows some risk measurement tools. These tools are-

Risk Management ProcessThe some general steps can be used to systematically analyze and deal with risk, known as the risk management process. At this point we can be summarized as follows:

Risk Management

Process

Indentify the Loss Exposures

Establishing the Context

Assessing the Loss Exposure

Potential Risk Treatments

Implementation

INSURANCE PRICING,CLAIM SETTLEMENT & COMPANY ANALYSIS

Presented byMd Mohaiminul Islam

Pricing Process

Pragati Life Insurance Limited is continuously developing its products depending on the trend of the market, changes in financial market and social market. In order to meet the present stiff competition and challenges the company is constantly trying to upgrade its existing product range and to develop new innovative products as well. The company designs their product prices according to the need of their customers in order to meet the competition. The pricing is done primarily on the basis of age primarily and then on other criterion.

Pricing Elements

Agents commission

Administration cost

Return from investment of Premium.

Pragati life Insurance Limited considers three things as their pricing elements.

Claim Settlement Procedure

The policy holder calls up the insurer claiming the insurance asking about all the minute details of the process of claiming the same along with the documents required.

The insurance company asks for the details of the loss and the relevant documents in support of the claim

A notice has to be issued be the policy holder for claiming the same with utmost urgency mentioning all the possible details (name of the policy holder, names of the persons associated with the accident, witness particulars, their addresses etc.

The company would make all the possible queries and inspections by the company representatives or consultants

They have the right to inspect all the relevant properties related with the loss along with police verifications and determination of the policy holder’s liability structure

The processing period is mentioned in the contract document , which is the approximate time required for verification of the genuineness of the insurance claim

On agreement of claim amount between the insured and the insurer, the claim is settled

Reinsurance Management

The Company maintains reinsurance arrangement with Munich Reinsurance Company of Germany since its inception. The net retention of the company for individual life is Tk. 2 lac per policy and for Group life Tk. 10 lac per person of risk. Reinsurance premium is recorded as an expense evenly over the period of the reinsurance contact and off-set against the premium income of respective year. The claim recoveries arising out of reinsurance contracts are off-set against the claims expenses of respective year

SWOT AnalysisSWOT is for Strengths, Weaknesses, Opportunities and Threats. The SWOT analysis of pragati life insurance company Ltd is given below:

Strengths• High standard of integrity and

responsibility• constant innovation• operational efficiency• cost effectiveness

Weakness• Weak governance• Weak management• No policy for risk management

Opportunities• Large potential market• Lower operational cost• Government support

Threats• Economic instability• Global crisis• Risk involves with the customer

SWOT

PERFORMANCE ANALYSIS OF THE COMPANY

Presented byMd Mozaffar Hossain

To measure the performance of the company we go through some analysis. These analysis may include

• Trend Analysis• Cross sectional analysis• Common Size Statement analysis• Scenario Analysis• Sensitivity analysis etc.

An aspect of technical analysis that tries to predict the future movementof company’s financial condition based on past data. Trend analysis isbased on the idea that what has happened in the past which gives anidea of what will happen in the future.In trend analysis we analyze • Profitability index• Current ratio• Return on asset• Expenses of Management to premium Ratio• Return on equity• Debt to equity ratio• Claim on premium

Trend analysis

Results of some ratio analysis of Pragati Life Insurance as per 2012 are shown below_

• Profitability index= 12.01%• Current ratio= 4.59:1• Return on asset= 7.06%• Asset-Premium ratio= 58.84%• Claim to Premium Ratio= 32%• Expenses of Management to premium= 46.36%

Company Name Profitability Expense on

Premium

Claim to Premium

ROA

Pragati Life Insurance

12.01% 46.36% 32% 7.06%

SandhaniLife Insurance

6.54% 39.32% 41.06% 4.29%

National Life Insurance

8.56% 41.98% 44.41% 3.31%

In this part of the chapter we will compare the trend analysis results of Pragati Life Insurance with other life insurance companies

We will here compare Pragati Life Insurance with SandhaniLife Insurance and National Life Insurance

Cross sectional analysis

Premium 100%Interest 7.51%Income Tax 0.69%Dividend 0.48%

In this segment we compare the prime elements of income statement and balance sheet and their ups and downs comparing with the amount of premium of a particular year. Major elements here are weighted here with total premium collected.

On this basis income statement of 2012 of Pragati Life InsuranceLooks like this

Common Size Statement analysis

And the balance sheet looks as

Shareholder’s capital 5.02%

Liabilities 14.03%

Asset 169.95%

CONCLUSION

In present insurance is too much important to the business and individual sector. Most of the companies provide more or less same services. For this reason the competitions increasing day by day between the insurance companies. Pragati life insurance is the second largest insurance company of Bangladesh. It has achieved “A” rating by CRISL for claim paying ability. To meet the challenges the company is constantly trying to upgrade its existing product range and to develop new innovative products as well.

THANK YOU

ANY QUESTIONS?