biio module

8/6/2019 BIIO Module

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Assessment Front Sheet

IMPORTANT: Your assignment will not be accepted without the FRONT SHEET.

Campus: Level:Pune Stream:

PCL-1 Year/Semester

Banking and Insurance

PGDBE2 nd yr/ 3rd sem

Module Assignment

Module Name:

Students Name:

Issued on: 15/11/2010

Actual Submission

Date: 22/11/2010

Industry operations Nirav ReshamwalaAssignment Type:

Assessors Name: Mr. Pranjal Joshi

Reqd. Submission Date: 19/11/2010

Submitted to : Seher Maam

Higher Level Skills

Students are expected to develop the following skills in this assignment:

Cognitive skills of critical thinking, analysis and synthesis.

Effective use of communication and information technology for business applications.

Effective self-management in terms of planning, motivation, initiative and enterprise.

Certificate by the Student:

Plagiarism is a serious College offence.

I certify that this is my own work. I have referenced all relevant materials. Nirav Reshamwala

_______________________

(Students Name/Signatures)

EXPECTED OUTCOMES Assessment Criteria To achieve each outcome a Achieved

(Y/N)

student must demonstrate the ability to :


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Training in Insurance Analyze and identify the areas which the training

organization is exposed.

Future of the Insurance market. The working of private Insurance and its role in framing

the future of the insurance market

Assignment Grading Summary (To be filled by the Assessor)

Grades Grade Descriptors

P A Pass grade is achieved by meeting all the requirements defined.

M1 Identify and apply strategies to find appropriate solutions.M2 Select/design and apply appropriate methods/techniques.

M3 Present and communicate appropriate findings.

Achieved Yes/No (Y / N

D1

D2

D3

Use critical reflection to evaluate own work and justify valid

conclusions.

Ability to anticipate and solve complex tasks in relation to the

assignment.

Demonstrate convergent, lateral and creative thinking.

OVERALL ASSESSMENT GRADE:TUTORS COMMENTS ON

ASSIGNMENT:

SUGGESTED MAKE UP PLAN

(applicable in case the student is

asked to re-do the assignment)

REVISED ASSESSMENT GRADE

TUTORS COMMENT ON

REVISED WORK (IF ANY)

Date:

Assessors Name / Signatures:


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Q1. A cheque of Rs. 40000/- is presented for payment with the amount in figure

written in English and other particulars in regional language where branch is

located. The signatures tally with the specimen. Whether the Banker will Pay or

not? Give Substantive reason to your decision.

Ans.

As per banking practice, a cheque written in regional language and figures in

English, if the numerical figure and written in words figure is matching the banker

must have to honour the cheque if it is otherwise in order. In this case the banker

should honour the cheque.

Q2. Arvind Desai, your saving bank customer, issues a cheque in favour of Mr.

Narayan B, who negotiates the cheque to Mr. Chakraborty. Your branch receives

this cheque in clearing for payment, but a notice of death of Mr. Arvind Desai isreceived. What will you do with this cheque? Explain with reason.

Ans.

Here, if you receive the notice of death, assess the date and time of death. If the

death takes place the same day of notice, you could assess the cheque has been

drawn before the death as because you got the cheque through clearing and it takes

1 or 2 days to get it cleared at your end. So very well you would know the cheque

has been drawn before the death of the customer and you could honour it.

But in other cases, if you have enough reason that the cheques is drawn on the same

day or after his death, you could return the cheque, as the general rule regarding it

is when you get a notice of death of the customer, you can return the cheque giving

the reason thereof.

Q3. Explain FEMA? How many types of credit facility are available to Importers

& Exporters? Mention in detail the parties to Letter of Credit?

Ans.

FEMA- Federal Emergency Management Agency. An agency of the federal governmenthaving responsibilities in hazard mitigation; FEMA also administers the National Flood

Insurance Program.

It will facilitate trade rather than prevent misuse of foreign exchange.

Definitions of capital account transaction and current account transaction have

been introduced keeping in mind the possibility of introduction of capital account

convertibility in the near future.

All current account transactions shall be allowed (subject to reasonable

restrictions). Reserve Bank to classify those capital account transactions that are to


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be permitted and to regulate transfer and issue of foreign securities by a resident

in/outside India as well as setting up of branches/offices by foreign companies in

India.

All key sections relating to dealings, holding and payments in foreign exchange

and exports have been simplified.

Liberalization in enforcement provisions reflects that the attitude is of putting trust

in the persons covered.

Types of credit facilities available from a commercial bank:

(i) Overdraft Facilities

(ii) Personal Loans

(iii) Term Loans

(iv) Discount of Bills

(v) Invoice Discounting

(vi) Guarantees and Indemnities

(vii) Letters of Credit

(viii) Bills of Negotiation

(ix) Acceptance Facilities

Parties To A Letter Of Credit

* Depending on the circumstances, various names used in a letter of credit may refer

to the same party.

* The Applicant opens the letter of credit.

o The buyer, or customer, is the Applicant.

o Sometimes the Applicant is called the account party.

* The Opening Bank issues the letter of credit.

o The Opening Bank's credit replaces the buyer's credit.

* The Advising Bank is an agent of the Opening Bank.

o Verifies the authenticity of the Opening Bank.

* The Confirming Bank is usually the Advising Bank, but it confirms that the credit

exists.

o It can negotiate the documents, and can accept the letter of credit the Opening

Bank will not pay.

* The Paying Bank is also called the drawing bank.

o The Paying Bank may act also the Advising Bank, or the Confirming Bank, or

the Opening Bank.

* The Beneficiary is often the seller.

o It is party to whom the credit is issued.


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Letter Of Credit

A letter of credit is the most commonly used form of secure payment.

o It is a document issued by a financial institution at the buyer's request and

instructions.o It spells out the terms under which the seller will be paid.

Pay the seller a certain amount when it produces documents

according to the instructions.

o It acts as an escrow account.

A letter of credit is the preferred method of payment in trade with areas outside of

Western Europe, Canada, and the United States.

o Because it offers independent assurance to the both exporter and buyer.

A letter of credit is a critical document, so it is imperative that the seller issue

clear guidelines to the buyer on how to open a letter of credit.

Case Study:

Q1. How the training of Insurance plays an important role in the development of

Insurance Business.

Ans.

Role of training in the development of Insurance Business-

Optimum Utilization of Human Resources Training and Development helps in

optimizing the utilization of human resource that further helps the employee toachieve the organizational goals as well as their individual goals.

Development of Human Resources Training and Development helps to

provide an opportunity and broad structure for the development of human

resources technical and behavioural skills in an organization. It also helps the

employees in attaining personal growth.

Development of skills of employees Training and Development helps in

increasing the job knowledge and skills of employees at each level. It helps to


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expand the horizons of human intellect and an overall personality of the

employees.

Productivity Training and Development helps in increasing the productivity of

the employees that helps the organization further to achieve its long-term goal.

Team spirit Training and Development helps in inculcating the sense of team

work, team spirit, and inter-team collaborations. It helps in inculcating the zeal

to learn within the employees.

Organization Culture Training and Development helps to develop and improve

the organizational health culture and effectiveness. It helps in creating the

learning culture within the organization.

Organization Climate Training and Development helps building the positive

perception and feeling about the organization. The employees get these feelings

from leaders, subordinates, and peers.

Quality Training and Development helps in improving upon the quality of

work and work-life.

Healthy work environment Training and Development helps in creating the

healthy working environment. It helps to build good employee, relationship so

that individual goals aligns with organizational goal.

Health and Safety Training and Development helps in improving the health

and safety of the organization thus preventing obsolescence.

Morale Training and Development helps in improving the morale of the work

force.

Image Training and Development helps in creating a better corporate image.

Profitability Training and Development leads to improved profitability and

more positive attitudes towards profit orientation.

Training and Development aids in organizational development i.e. Organization

gets more effective decision making and problem solving. It helps in understandingand carrying out organisational policies. Training and Development helps in

developing leadership skills, motivation, loyalty, better attitudes, and other aspects

that successful workers and managers usually display.

Till 1999, there were not only private insurance companies in Indian

insurance sector. The Govt, of India, then introduced the insurance IRDA

(Insurance Regulatory Development Authority) Act 1999. During that time LIC

(Life Insurance Corporation of India) only one player in the market and having a


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monopoly that time LIC was not giving steady training its employee and did not

adopt new technology. So they could not provide better service its customer which

is drawback in the development of Insurance business. Thereby deregulating the

insurance sector and allowing private companies into the insurance, further, foreign

investment was also allowed and capped at 26% holding in the Indian insurance

companies

Service:- Training helps to better service. Earlier LIC (Life Insurance corporation

of India) was only one player in the market so it having a monopoly in the business.

But LIC was not providing better service than private player came into the market

also they provide better service to customers. So private player get growth than LIC

decrease its holding in the market.

Product:- Training is need before the new product came into the market. So help to

the training employees get better knowledge of new the product or different

product. So they have through knowledge of the product from that they easily

convince the customer when they are going to sale product.

Quality:- Training help to the improve the quality of service Eg: Earliar LIC is not

giving service of the customer but now days they give training their employee

about current technology and started service. so insurance company can give

qualitative service which is increase the business.

More advisors:- Helps to training not only individual person themselves but

broker, corporate agent also allowing to sale of life insurance which is helps to

development of insurance business.

Increase business:- Helps to training employee become professional and get

through knowledge of the product. So employee get more confidant for the

convince to customers when they are going to sail life insurance product.

Ultimately it is increase to the business development.

Team spirit:- Training helps to the increase team sprit. Eg; One particular team

they having a target 50 policy in a month so with help of training they get close

each others and achieve their target to gather and mutual understanding help to

whole team. Life insurance company get increase the business.

Favourable economic climate and number of other factors such as,

growing urbanization, increasing consumerism, rise in the standard of living,

increase in financial services for people living in rural areas, etc has increased the

demand for wide range of financial products that has led to mutually beneficial

growth to thebanking sector and economic growth process. This was coincided by

technology development in the banking operations.
http://www.naukrihub.com/job-openings/banking-india/http://www.naukrihub.com/job-openings/banking-india/


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Q2.There is absolutely high opportunities for private insurers-examine critically.

Ans.

Insurance sector was opened up for private participation with theperformance of the Insurance Regulatory and Development Authority Act, 1999.

The insurance sector was opened up for private participation nine years ago. For

years now, the private players are active in the liberalized environment. Most of the

private insurance companies have formed joint venture partnering well recognized

foreign players across the globe. After this every private insurance sector player

was coming in market one after one. Private Player tries to capture market and give

their efforts increase for their business.

During this time period 33 private players entered in the insurance sector.

Interestingly, eight players four each in life and non-life insurance entered thearena during Mar 2007-Aug 2008. Currently, the insurance sector comprises 1 re-

insurance, 21 life insurance, and 19 general insurance companies. Major

international players like AIG, Aviva, MetLife, New York Life, Prudential, Allianz,

Sun Life, Standard Life and Lombard are already present with minority stakes in

joint ventures with Indian companies for both Life and Non-life segments

Opportunity

Private Player have good opportunity increase business in an Indian market

because if we talk about Indian life insurance business. In India 20% population haveinsurance rest of 80% population have not insurance. Therefore this 20% insurance from

that 50 % share held by LIC (Life Insurance Corporation of India) and rest of 50% held

by private players so we can say these aspects show vast potential of the Indian

insurance industry.

Fast growing economy.

Increasing per capita income in India.

Saving behaviour.

High growth of ULIP industry.

Strengths:- Dedicated Employees.

Well Efficient Management.

Technology.

Adaptability to changes.

Market share:

The Private Life Insurance Companies have put a fantastic effort to break into the

monopoly of LIC India. LIC controlled 100% of the market in 2000 and since then its

market share has slipped to less than 50% and at the end of October-08, it was at 37.1%.


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Private Insurance Companies control 62.9% of the Life Insurance market in India. Here

is the market share of various Life Insurance Companies in India at the march of

FY2008-2009

Premium income

Private insurance sector also increase their premium income year after year. here we can

see private sectors also earn from the Indian market because premium income increasenow we can say people are also invest private insurance company otherworlds they are

believe of private sector.

Growth of private insurance company

Private insurance sector are increasing which fruit full for us but so many draw back or

weakness is there.

Misguide to the customers

Many more players in the market and they have large share India with population over

the billion. But reality is that completion is increase so insurance companies also

misguide to the people for sail their insurance policy. We can see so many such type of

case now days.

Delay in claim pay:

Time of the claim play, now days we have seen lost of case private player delay for

claim play. And give mentally harassment to customers.

Reaching Out To Customers:

No doubt, the customer profile in the insurance industry is changing with theintroduction of large number of divergent intermediaries such as brokers, corporate

agents, and ban assurance.

Q3. Trace the future of Indian Insurance

Ans.

The reforms in the insurance sector leading finally to the opening of the insurance

sector for private participation have brought in its wake major changes not only in thedesign of the products available in the market but also the manner in which they are

marketed. We have today a host of products coupled with a large number of

intermediaries who market them.

The post-liberalized insurance industry panorama in India is witnessing dramatic

changes in terms of a slew of latest products and services, new channels of distribution,

greater use of I.T. as a service facilitator etc. There is also the phenomenon of noticeable

shifts in consumer preferences impacting the product mix being offered by insurers. The


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market structure dominated by a few stabilized public sector players and the 'new'

players in the market (some of whom claim their lineage from established international

insurance behemoths) is in a state of flux- in terms of figure out market shares but is full

of potential.

Added to these are the rising trends of convergence of financial services,

especially in the areas like wealth management and evolution of newer risk management

tools, particularly in the context of reinsurance management. Greater attention is alsobeing bestowed on the areas like Agricultural Insurance and risk coverage of export-

import trade. Then there is impact of visible socio-economic changes like greater

urbanization, greater job mobility, growth of the services industry, weakening of

traditional family structure, impact of globalization etc. All in all, interesting things are

happening in the Indian insurance scene.

Insurance undergone rapid and massive changes in all aspects of their business:

product and services, sectoral structure, market segmentation, competitive environment.

It is believed that the information sharing has not taken its expected shape in the

insurance industry for the purposes of practices, research and education. However, data

is one of the most needed ingredients in the insurance business development as well as

for research and consultancy. There have been regular efforts by IRDA for collection

and sharing of the data and other information of public interest. The industry is facing

problems in terms of data review as parliament need to register this beforehand. We

believe that progress of the industry should not be constrained by any extraneous

conditions in the interest of research and development in the area.

Manpower India today released the Manpower Employment Outlook Survey for

the first quarter of 2006 revealing sustained positive hiring intentions of employers inIndia. India continues to lead all 23 countries surveyed this quarter, with a positive

overall Net Employment Outlook of +27%. Even though this figure represents a

decrease of 13 percentage points from the fourth quarter of 2005, the employment

outlook remains extremely healthy. For the first time since the Survey was launched in

India, the Finance, Insurance and Retail industry sector emerged as the most optimistic

sector for a quarter with a Net Employment Outlook of +32%, surpassing the Services

sector.

Privatization of insurance sector has allowed insurance companies to work in the

market by depositing 100 crore rupees in the reserve of government. This hasencouraged many overseas insurance companies, having a required amount in their

reserve, to open their branch in our country. Introduction of the sector has changed the

employment pattern, but people must know how to make profit from it. To be in the

global market and have advantage of it, capital and skill as per the demand and

knowledge of market is the requirement. It is necessary that institutions, which form a

part of this financial system, have internal management, governance and accountability

structures, which measure up to the highest standards.

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