6.3 SBI GENERAL INSURANCE 6.3.1 6.3.2 6.3.3 6.3.4 6.3.5 6.3.6 6.3.

7 Introduction of General Insurance Needs, Advantages and Disadvantages of General Insurance Types of General Insurance SBI General Insurance - Company profile Products of SBI General Insurance Competitors and Other players SWOT Analysis of SBI General Insurance

6.3.1

Introduction of General Insurance

General insurance General insurance covers all different types of activities performed by human. These are also called as non-life insurance. Types are: House / office / factory or any movable fire insurance assets destroyed in fire. Shipment or transportation of goods marine insurance by ship, destroyed in catastrophe. Jewellery / cash / household goods stolen burglary insurance or robbed. Goods in transit by road or railway carrier insurance destroyed. Theft or accident of vehicles vehicle insurance. Financial cover in ailments / surgery etc. Health insurance. Purpose and need of insurance: Life is full of uncertainties and insurance is based on un-certainties and if there are no uncertainties about the occurrence of a disaster, the concept of insurance will cease to exist. For insurance, if one is able to predict the forthcoming dangers, then one will take a proper safeguard action and then face the crisis in a very normal manner, but then, this is an utopian concept; because death, disaster and danger cannot be predicted. All individuals have assets; both tangible; the house, car, factory or intangible like voice of a singer, leg of a footballer, the hand of a author and many such others as quite often seen in the western countries. Now all such assets are insured, because they run the risk of becoming non-functional through a disaster or an accident. Such possible and unforeseen occurrences are known as perils. And the damage caused by such perils are the risk that the assets are exposed to. Risk is a contingency and the insurance is done against such possible contingencies. The concept of insurance is quite simple. People who are in a similar trade and are exposed to the same risks, congregate and come to an agreement that if any individual member suffers a loss, then the loss will be shared by others and minimised in order to enable the individual member recover from the loss and cover his ground. Similarly the different kinds of risks can be identified and separate groups can be formed to counter such risks and reduce the impact to a manageable proportion, in which the share could be collected from members either after

the loss or in advance, at the time of admission to the group. This is an exemplary sign of humanity and insurance therefore serves mankind to a great extent; a point most of the individuals tend to overlook, since monetary aspect is involved. Now such insurance is for tangible assets. The concept of insurance has been extended beyond the coverage of tangible assets. Exporters run the risk of importers in other country defaulting as well as losses due to sudden fluctuations in the currency exchange rates, economic policies turmoil. These risks are now insured. Doctors run the risk of being charged with negligence and can subsequently liable for damages. The amounts in questions can be fairly large, beyond the capacity of individuals to bear. These are insured. Thus insurance is extended to intangibles. In some countries even the voice of a singer, legs of a footballer can be insured, even though the advantage of spread may not be available in these cases. Satisfaction of economic needs requires generation of income from some source. If the property, which is the source of such income, is lost fully or partially, permanently or temporarily, the income too would stop. The purpose of insurance is a safeguard against such misfortunes by making goods the losses of the unfortunate few, through the help of the fortunate many, who were exposed to the same risk, but saved from the misfortune. Thus the essence of insurance is to share losses and substitute certainty by uncertainty. Similarly human life is also an income-generating asset, albeit, intangible. This asset can be lost through an unexpectedly premature death due to some accident or disease or the asset can also be made non-functional through some disabilities. In the case of such unforeseen mishaps, insurance becomes essential to help those who are dependents to maintain their life in a normal and a regular manner. In this context, it becomes essential to mention that living too long can be equally or sometimes more problematic than dying too young. Hence a very old age can be considered to be a risk and insurance takes care of all such risks which need to be safe-guarded against. Insurance can minimise the impact of the risk on the owner of the asset and those who depend upon the asset, but only in terms of economy or finance, not in terms of emotions. Hence one can see the need and the purpose of insurance, which sadly speaking still remains a neglected part of an individuals life.

SBI General Insurance - Company Profile

SBI General Insurance Company Limited is a joint venture between the State Bank of India and Insurance Australia Group (IAG). SBI owns 74% of the total capital and IAG the remaining 26%. SBI General closed the financial year 2012-13 (3rd year of operation) with a Gross Written Premium of Rs.770.85 Crores registering a growth of 208 %. During the year 2012-13, SBI General in association with State Bank of India covered over 1 Crore Saving Bank Account holders of SBI with a Personal Accident Insurance cover worth Rs.4 Lakhs. SBI General has also established its presence in nearly 14,000 Branches of State Bank of India. SBI General

follows a robust multi-distribution model encompassing Bancassurance, Agency, Broking & Retail Direct Channels. Today, SBI Generals Distribution family includes over 9,400 IRDA certified SBI & its Associate Bank employees and over 3,200 Agents. SBI General's current geographical coverage extends to 38 cities pan India and plans are on to extend this reach to another 20-25 cities before the end of the current financial year. SBI General is currently serving three key customer segments i.e. Retail Segment (catering to Individual & Families), Corporate Segment (catering mid to large size Companies) and SME Segment. In a short span, SBI General has emerged as one of the few General Insurance companies in India to have a dedicated SME Team catering exclusively to the needs of SME Segment. Current Policy offering of SBI General covers Motor, Health, Personal Accident & Home Insurance for Individuals and Aviation, Fire, Marine, Package, Construction & Engineering, Liability, Group Health, Group Personal Accident & Miscellaneous Insurance for Businesses.

Vision: Be the most trusted general insurer in India with fair and transparent business practices, leading the Nation's effort in increasing insurance penetration.

Products of SBI General Insurance

Insurance for Individual
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Motor Insurance Motor Private Car Motor Two Wheeler Personal Accident Insurance Group Personal Accident Home Insurance Long Term Home Health Insurance Health Insurance

Insurance for Business

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Fire Insurance Standard Fire and Special Perils Consequential Loss (Fire) Fire Insurance Group Health

 o o o o o o o o o o o o o o o

Motor Insurance Tractor & other Farm Vehicles Commercial Motor Marine Cargo Marine Cargo Package Insurance Industrial All Risks Business Package Miscellaneous Plate Glass Insurance Burglary Insurance Money Insurance Construction / Engineering Contractors All Risk Contractors All Risk Erection All Risk Machinery Breakdown Boiler and Pressure Plant Electronic Equipment Consequential Loss (Machinery Breakdown)

Other Players: Public Sector Government of India wholly owned 4 companies:

National Insurance Company New India Assurance Co Ltd Oriental Insurance Co Ltd United India Insurance Co Ltd

Private Sector

sanmuga raj General Insurance Bharti AXA General Insurance[1] Continental Insurance Services Future Generali India Insurance[1] ING Vysya Life Insurance HDFC ERGO General Insurance[1] ICICI Lombard[1] IFFCO Tokio Liberty Videocon General Insurance Co Ltd

L & T General Insurance[1] Magma HDI General Insurance Co Ltd[1] Max Life Insurance Co ltd[1] Raheja QBE General Insurance[1] Reliance General Insurance Royal Sundaram[1] SBI General Insurance[1] Shriram General Insurance[1] Tata AIG General Universal Sompo General Insurance Cholamandalam MS General Insurance Company Limited