INSURANCE-CORPORATION.pdf

7/24/2019 INSURANCE-CORPORATION.pdf

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INSURANCE COMPANY

by

Beatrixe Marie G. Calpo

Chazedelk G. Cerdena

Ash Macalalad

Joebeth Espinosa

Jm Avila

Bradford Bailo

Joshua Almira

Kristel Manahan

Pauline De Joya

Daniel David

4ELM

A Research Portfolio Submitted

in Partial Fulfillment of the Requirements

in Other Commercial Laws (LMG 13)

SAN BEDA COLLEGE

638 Mendiola St., San Miguel, Manila

October 31, 2015


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INSURANCE CORPORATION: A Research Portfolio

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PREFACE

The purposes of this paper it to introduce to the readers the

environment of insurance corporations. Insurance today plays a vital role in

the economy of any country and world trade. Insurers can make or break

new investments or stop existing businesses from expanding as if they

decline to insure then Banks will refuse the necessary loans. Most businesses

have to rely on Bank finance for their development and Banks oblige them to

insure their exposures. Insurers allow communities to recover from the

disastrous financial consequences of natural catastrophes (Earthquakes,

Tsunamis, Tropical Storms) or human related events (September 11th2001

being the most recent memorable event). Insurers also play a social role in

society by sponsoring sporting events, educational programs and youth-

orientated schemes to name but a few of the philanthropic contributions

Insurers make to society.

If we take a modern country such as Canada we find that major

Canadian companies and financial Institutions derive more than 25 percent

of their debt financing needs from Life and Health Insurance Companies.

This source of long term capital is crucial to a vibrant and growing economy.

On top of this by helping to protect individuals, their families and their

businesses against the financial risks of death, illness and retirement with


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financial security products the insurance industry complements and

supplements the public sector social security systems.

This paper will typically include six main sections: The Business

Environment, Finance/Investment, Investment policies and Laws, The tax

system, General Registration requirements and BDO Offices.

This paper is primarily addressed to students, who play a very

important role in the growth and development of the economy. An

understanding of the background of insurances will help them understand

better in terms of our economic needs.

Grateful acknowledgment is here made to those who helped these

researchers gather data for this paper and to our Commercial Law professor,

Mr. Guiller Asido, for providing much information and insight about our

research topic and that for this work would not have reached its present

form without their invaluable help.


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BUSINESS ENVIRONMENT

Insurance is one of the very important financial services from all over

the world. It is one of the most grooming sections of the economic growth

and development. This industry is the major source of the long term funds

which is required for the development of the necessary infrastructure for the

country.

The insurance business environment consists of set of factors and

variable that provides various threat and opportunity to the operations of the

insurance business. The Factors and variable may not always be poisonous;

they may bring much good news to the existing business players. The

insurance business environment can be broadly classified as follows:

INTERNAL INSURANCE BUSINESS ENVIRONMENT

The insurance industry in a country is affected by a large number of

factors for its healthy development and growth. A congenial (comfortable)


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environment is a prerequisite, which is governed by many factors such as

the economic state of the country, political stability, awareness amongst the

public, awareness of investment for surplus generated and good steady and

reasonable returns, and better corporate governance. There are certain

other internal factors which have been direct or indirect effect on the

insurance environment. These internal factors are explained as follow:

Since all insurance companies have the same business environment, the

researchers elect to do a research on Indian insurance companys business

environment. And will set it as an example.


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Risk Management

Insurance is the business where insurance company transfers the risk

of the company. This is the concept of pooling of risk. The risk is thus an

integral part of every insurance organization. The company which promises

the transfer of risk will have to manage the risk of its own. The risk

management is an integral part of the insurance business. The sum received

as premium for the insurance policy is invested in derivative market which is

highly volatile. It is now well known in the financial world, as to how risk can

destroy corporate value and how value additions can be achieved through

Risk Management. At present, risk assessment and risk hedging models are

being increasingly used in the corporate sectors. Financial engineers are now

well equipped with the latest tools and techniques and products of the risk

management. A number of insurance companies are selling risk

management products, and insurance multiplies are being placed directly in

the capital markets and the corporate sectors. Thus proper risk management

strategies are required at each level of the insurance company. The firms

capacity to absorb risk is determined by its current exposure to other risk.

And thus all this risk is the important constituent of the internal environment

of the insurance company.


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Transparent Rules and Regulations

Now there are large numbers of insurers in the life and non-life

insurance business. These organizations deal in the variety of their own

products / policies. These require proper control while formulating and

implementing their respective rules and regulations. If there will not be any

standards for the operations and rules and regulations, it will be very difficult

for the insured to manage his policy. The IRDA have come a long way, since

its inception in November, 1999. The following regulations have already

been notified and the others are in the process:

i. Appointed Actuary

ii. Actuarial Report and Abstract

iii. Asset liability and solvency margin of insurers

iv. Licensing of insurance agents

v. General insurance reinsurance

vi. Registration of Indian insurance companies

vii. Insurance Advertisement and disclosures

viii. Regulation on investment life and non-life

ix. Regulations of accounts


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x. Surveyors Regulation

Thus the transparent and better the regulations in place, better would

be environment for generation and growth of insurance business in the

country.

Technology

Technology plays a strategic role in providing a competitive edge, be it

in aiding design and administering of products and building lifelong customer

relationships. The use of better technology will help to enhance service and

ensure effective and efficient service, delivery and lead to greater

customization of products and greater efficiency. Most of the insurer has to

set up national call centers, interactive voice response service system, and

web site etc. to grab the maximum business. It will help and create brand

position. Before the emergence of information technology, no insurer could

ever think of such advantage. The technology has helped in providing value

added services and a great facilitators to the agents and the customer

residing at faraway places. Moreover, it will also help the insurance sector to

conduct proper training and development programs. Use of internet for

purchase of products, catering to ones servicing needs, payment of

premium etc. The various services offered are as follow:

b. Providing for tele-services offering

c. Advising on right kind of insurance covers


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d. Advising on extent of life cover required

e. Advising on right investment decision

Thus role of technology also brings various threats and opportunities

of the insurance business environment.

Scope of Rural Insurance

Rural market in India is biggest as compared to any other nation in the

world. It was untapped source of funds for the insurance company but due

to lack of purchasing power of the people this sector of insurance remains

untouched and not explored fully. Then IRDA came into scene .The IRDA has

now defined it and has been made compulsory to do a certain percentage of

rural business by the private sector players. It has a wide scope and remain

untapped to the extent it provide opportunity. In rural areas the policies are

of smaller denominations, but this is compensated by the large number of

policy holder in urban areas. It is necessary to identify the right agent that

can target and cultivate the rural sector. The rural insurance should be

looked as an opportunity not as an obligation. A number of innovative

products and an efficient delivery system are two aspects that have to be

developed in order to penetrate the rural areas. Now the new entrants in the

insurance sector will definitely form their efforts on rural sector. Although

this sector presents number of challenges, it will provide great opportunities


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also. It is necessary to tap into the rural society. It is one of the very

important internal factors of insurance business environment in the country.

The Business of Retailing Risk

The extent of risk that an insurance company can bear is determined

by its net worth. The minimum capital requirement by IRDA for insurance

companies is 100 crores. Now all private non-life insurance companies are

looking at the corporate sector as they do not have sufficient funds for the

retail segment. Going by the solvency norms, the insurance company cannot

maintain proper solvency if all sum received is invested. This creates high

risk and thus reinsurance come into picture. To build up national reinsurance

capacity, the Government of India designated the General Insurance

Corporation of India as the national reinsurer. All no life insurer has to

compulsorily part with 20 % of their premium to GIC. In return this company

will be secured if in case the claim in any particular year due to extra

ordinary event increases rapidly. Therefore, it is evident that better the

business of retailing risk, the better will be considered the internal

environment for the insurance business.

Specified Training and customization program

The insurance business environment in any country is affected by the

reflection of the training and its quality on implementation to the various

intermediaries and agents. The IRDA has stipulated that all insurance sales


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agents have to undergo 100 hours of training and clear examination

conducted by insurance institute of India. The reason is that all the players

entering the insurance market need to have sales agent trained by the IRDA

accredited institutions. The syllabus rest on 60 % technical and remaining

based on the motivational task a sales agent has to perform. On line and

distance learning are providing a boon in training of insurance agents in

India. The more the trained personnel, the better it will be for the insurance

business of a country

Pricing of the Products

The pricing of the policy in insurance sector has a definite being ON

INSURANCE BUSINESS. The price always has an impact of the demand and

supply of the products and the services. So the pricing of the insurance

products will have a bearing impact on the insurance business in the

country. The pricing of the product undergo change and the regulator will

have to monitor it in order to create a healthy competition and insurance

market in the country in view, entry of private players. The provider and the

receivers both will have to interact very closely to secure a fair deal on the

pricing of the deal, as the good state insurance sector will no longer be in a

monopolized position. There should be meaningful and viable price for any

product to be marketed and sustained. However the responsible company

can afford to cut prices to a certain point, if they are to preserve their own

financial stability and ability to meet their obligations. This is an area which


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provides unlimited opportunities in the Indian context for consultancy,

broking, and education in the post privatization phase with new employment

opportunities.

Growing consumerism

The Indian economy with its growth of around 6% is now moving

towards the standard of living of the people. The very base of the middle

class population is broadening to around 300 million. It is a knowing fact

today that China and India are attracting the maximum attention of the

world, as they are only most populated countries, but also the most closely

viewed developing economies of the world. The openness of the economy

from the closed one has led to an era of well-defined consumerism. There is

a new kind of pressure on the consumer profile aspiring for quality,

effectiveness, and adaptability. Theses parameters would now determine the

survival of the market operators. With the competitiveness, the emphasis

would be in innovative of new products, and value added customer service.

Thus, aggressive market approach would be significantly required to Ancash

the opportunity. The newly opened insurance sector has been evincing the

maximum interest only in one direction, i.e. the customer, by way of

devising new methods to reach him with the kind of products and services

which he expects today. The opinion of having a choice and that too varied

has certainly raised customer expectations. Today, the reality is that the

customer is more aware not only for his rights but also the alternatives


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available to him for better products and services as well as new avenue for

redressal of grievances. To achieve this goal, it calls for continued focus on

the customer which calls for total quality performance with continued

growth. The new players shall have to be committed to the TQP in products

and services so as to provide total customer satisfaction.

Consumers perspective

The emerging scenario will provide the customer with:

f. Choice of insurance, wide range of new and innovative products

g. Competitive pricing of the products and services

h. Access to information about the companies and products.

i. Continuous consumer education

j. A well trained and highly professional sales force

k. Prompt and courteous front office response

l. Greater focus on customer service

m. World class pre and post sales services

n. Efficient and customer friendly claim administration system.


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Long term savings and investments

The long term savings generated will be a big boon for the Indian

economy catalyzing additional funds for the infrastructure investments.

Insurance companies will also bring long term capital to the market, which

will add to the depth and breadth of our financial sector. It is hoped that it

will bring in long term investors in the primary and secondary markets and

will also lead to market stability.

Organizational Control and efforts

There are generally three modes to which the business especially in

insurance deals with. They are as follows:

o. Business General Mode (This involves selling of insurance products)

p. Maintenance Mode (This deals with retaining the current market share)

q. Payout Mode ( When the claims are settled)

All these three modes bring opportunities and threat to the insurance

environment. The effort in all the three modes put in up by the management

of the insurance company is an important factor for the insurance business

environment. The management also includes controlling the insurance

business in such a dynamic environment.


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Challenges and strategies of privatization

The insurance sector is not free from the challenges thrown open by its

privatization and entry of more and more players to operate within the

regulatory framework of IRDA. Some important challenges to be faced by

this sector of the economy in the coming years may include:

r. Providing more jobs: U.K. which is equivalent to MP in size and with the

Population of 55 million provides six lakh insurance jobs whereas India with

one billion employs close to 5 lakhs.

s. Fear of job loss

t. Private insurer coexist with LIC and GIC

u. Managing and motivating risk of cross border operations

v. Upcoming more products and more complex features

EXTERNAL INSURANCE BUSINESS ENVIRONMENT

The external environment of the insurance business has been classified

in four parts, namely, legal, economic, financial, and commercial.


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Legal Environment

The insurance sector cannot work in isolation. Its operations, growth,

and development are always conditional by various factors of which external

business environment is one of the significant factors. There are various

laws and acts which have direct or indirect applications in the insurance


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sector, the knowledge of which is a pre-requisite for all those who are

concerned with the business of insurance in any capacity. Some of the

important acts which are applicable in insurance are as under:

a. Insurance Act, 1938

b. Life Insurance Act, 1956

c. General Insurance Business Act, 1972

d. IRDA Act, 1999

e. General Insurance Business Amendment Act, 2001

f. Some provisions of Contract Act, 1872

g. Some provisions of Companies, 1956

h. Service Tax Act

Extensive regulation of insurance business in India was brought into

effect with the enactment of the insurance Act, 1938. It tried to create a

strong and powerful supervisory and regulatory authority in the controller of

insurance with powers to direct, advice, caution, investigate, inspect, search,

seize, amalgamate, authorize, register, and liquidate insurance companies.

However, consequent upon the nationalization of insurance business (Life in

1956 and general in 1972) applications of the insurance contract was greatly

modified by the nationalizing enactments and Government notifications


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issued there under. Most of the regulatory functions were taken away from

the controller of insurance and vested in the insurers themselves.

IRDA Act, 1999

The preamble to the Insurance Regulatory and Development Authority

Ac, 1999 reads:

An Act, to provide for the establishment of an authority to protect the

interests of holders of insurance policies, to regulate, promote, and ensure

orderly growth of the Insurance Industry and for matters connected

therewith thereto. Section 3 of the Act provides for the establishment and

incorporation of Authority. The Authority established shall be a body

corporate having perpetual succession, and common seal with a power to

acquire, hold and dispose of property, both movable and immovable and

shall sue and be sued by the said name. Section 4 lays composition of the

Authority. It shall have a chairperson and other members not exceeding nine

in number, of whom not more than five shall be whole-time members

appointed by the Central Government from amongst persons having

knowledge of general insurance, life insurance, actuarial science, finance

economics, law, and administration. Section 14 of the Insurance Regulatory

and Development Authority Act, 1999, lays the duties, powers, and functions

of the Authority. The Authority shall have the duty to regulate, promote, and

ensure orderly growth of the insurance business and reinsurance business.


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Economic Environment

The economic conditions of the economy lay heavy impact on the

insurance sector of the economy. The following factors of the economic

environment have an impact on the insurance sector:

a. The state of insurance business

b. Industrial Policy of the country

c. System of economic planning

d. LPG policies

e. Comparative worldwide insurance environment

Financial Environment

The Indian Financial Sector is dominated by Public Sector whether it is

in the segment of Insurance, Banking or development finance. But the scene

is fast changing. With the passing of Insurance Development and Regulatory

Act in January 2000, the Insurance Industry has opened the way for

participation by private sector entities. It is hoped that the new entrants will

bring with them experience of financial and commercial business

environment that will enrich the Insurance Sector. Most of the Private Sector

players who have entered the Insurance Sector so far have rich experience

of working in the Financial Sector with vast commercial acumen and scope of


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handling the varied type of activities. The fact is that no business entity can

grow unless it has proper systems and mechanism relating to its financial

and commercial activities. The Insurance Sector, therefore, is no exception

to the above corporate business principle.

Financial institutions play a key role in the growth process. They help

mobilize large savings. They also help to allocate resources more efficiently

among competing demands. Financial institutions are called financial

intermediaries because they act as a conduit for the transfer of financial

resources from net savers to net borrowers. This basic function of

intermediation is performed through transformation mechanism which are:

1. Liability assets transformation,

2. Size transformation,

3. Maturity transformation,

4. Risk transformation, and

5. Commercial and Marketing Transformation.

The gain to the real sector of the economy depends on how effectively

or efficiently the financial sector performs this basic function of

intermediation. However, institutions, like Insurance Companies perform

additional function over and above being financial intermediaries. They


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provide risk coverage. The risk to be insured must result in a loss which is

measurable in financial terms.

Capital Adequacy Requirement

The Insurance Regulatory and Development Authority have prescribed

the following scale of capital Adequacy requirement in the shape of paid up

equity capital for the entities doing Insurance Business.

(I) Companies engaged in the business of Life Insurance

(II) Companies engaged in the business of General Insurance

(III) Companies doing the business of Reinsurance

No company or other entity can do/or will be allowed to do Insurance

Business unless it comply with the minimum Capital Adequacy Requirement

as mentioned above

Investment of Assets New Norms

Every Insurance company includes investment of its funds from time

to time. It is not open to a company to make investments as it may like.

These are prescribed yardsticks for making investments in different forms.

The following percentages have been prescribed by the IRDA for making

investments by the Insurance Companies:

(1) 50% of Funds in Government Securities.


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(2) 20% of Funds in Corporate Debts.

(3) 15% of Funds in Market Investments.

(4) 15% of Funds in Social Sector.

The Social Sector includes Infrastructure, viz. roads, highways,

bridges, airports, ports, railways, water irrigation projects,

telecommunications, housing, generation, distribution, and transmission of

power. Investment in Government Securities tends to be highly liquid,

particularly in the following interest.

COMMERCIAL ENVIRONMENT

The insurance industry and business have to be made itself fully aware of

the breadth and depth of the:

(a)

Knowledge

(b)Experience

(c) Expertise of its officers and other intermediaries.

It should make constant efforts in assessing problems, and finding out

their solutions in the most scientific professional and cost effective manner.

It should have a clear vision and be ready to implement advanced

management systems, procedures, and controls wherever required in its

working. It should have a clear goal to achieve high levels of efficiency

productivity and competitiveness. We should not forget about the


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competition which is likely to be faced in between the large number of

operators in the public and private insurance sector. Therefore, to have

effective commercial viability the players in the insurance sector should

update themselves and acquire new levels of knowledge and expertise with

clear dimensions.

Product Development and Innovations

There has been a lot of efforts for the development of various products

and these innovations both in the life and non-life insurance in the country.

With the entry of private sector players and the demand of the prospective

customers in view of mounting competition, more and more products are

likely to be developed to cater to the requirement of the customers at

different levels. The insurance sector has to provide to its customers wide

choice of products and price. The competition will ensure innovation and

constant improvement of service. The non-life sector will face much

competition. In the case of existing players, they are already in the process

of connecting their distribution channels. Their managements have realized

that if they do not come up with new products and better services they may

stand to lose in the face of stiff competition.

Thus, innovative products should be made available as per the

developments of technology particularly in service industry, viz.

telecommunication, satellite, computers, and entertainment, etc. product


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development, and research will attract greater attention of players and they

have to update themselves as far as their products are concerned. The

marketing concept of general insurance will undergo a major change by

infusion of research and design of the products and the innovation of new

products.

Customer Service

The insurance sector is operating in the service providers sector,

where the customer service is very important. Customer service is an

organizational approach to delight a customer and not merely satisfy him by

simply fulfilling all his expectations. A very positive approach, tone of speech

and appearance are attitudes that create a first and last impression on

customers. Feedback is the best way of delivering quality services.

Therefore, the moment license is issued to a new player in the market; there

could be competition of a very high quality new products and services. New

thinking and new perceptions will arise to make excellence sustainable in a

liberalized insurance market in India.

Customer Expectations

In the present day competitive insurance environment, the role of

insurer has expanded tremendously. Beyond issuing traditional insurance

policies, they have to act as a consultant, advisor, and advocate to meet


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with the requirements of the prospective customers. At different stages, an

insured may expect:

1. Value added service from the insurance,

2. Development of new products,

3. Excellence in pricing and services,

4. Financial security,

5. Technological development,

6. Quality training to its staff,

7. After sales services, and

8. Customer satisfaction

Thus, the customers expectations have to be studied, reviewed from

time to time so as to get better business in the prevailing competitive

environment in the insurance sector.

Marketing Insurance

In the process of marketing of various insurance products we cannot

ignore two vital constituents of it, i.e. demand, and supply. The supply side

of insurance and the demand of the need will now undergo a major shake up

with the advent of new players in the market. The general insurance market,


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which consisted of 107 companies in the 1970s produced a market premium

of Rs. 15 crores, whereas at the end of 2000, the premium figure of the

state insurers stood at around Rs. 10,000 crores. The focus of the marketing

by the state insurance during all the three years was on laying the

foundation of infrastructure, creating need-based cover also caters to the

social insurance requirements of the Indian population. Therefore, with the

emergence of new players there will be emphasis on the marketing of

general insurance products both by Government owned as well as the

private sector players.

It is expected that the penetration of players will enhance the growth

of general insurance premium. Thus, marketing will be a focus item if

change in the coming days due to competition in the insurance sector, there

is going to be a drastic change in the distribution channel for marketing of

general insurance products. Reinsurance concept will also play a major role

in the marketing of general insurance products. Technology is changing very

fast, and Information Technology is one which will revolutionize the

marketing of insurance products. E-commerce and internet will enable the

direct purchase without intermediaries and thus, this is a major change

which the marketing field in insurance is going to face. Customer

relationship management and culture of insurance players as a quality

service provider will have its own role to play in marketing of various types

of innovative insurance products.


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Pricing of the product, i.e. Tariff

The pricing of the insurance product will also undergo changes and the

regulator will have to monitor it in order to create a healthy insurance

market. However, the tariff system for certain risk is bound to continue. This

is due to the reason that there would be more presence on the market for

flexibility and the players; both the providers and receivers will have to

interact closely to secure a fair deal on the pricing of the product. It is a fact

that insurance is after all a fund of many to take care of the calamities of

few and there should be a meaningful and viable price for any product to be

marketed and sustainable. There will thus be a definite pressure to move

away from the tariff rating and the market will determine the price especially

for personal insurance.


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FINANCE / INVESTMENT

Insurance companies are like any other business in the world. They

have to make a profit to stay in business. There are two basic ways this can

be accomplished. They can earn underwriting income, investment income, or

both.

Underwriting Income

Underwriting income is derived from the difference between how much

money is collected for all policies sold versus how much money is paid out

ininsurance claims for those policies in any given time period.

For example, Insurer A may collect $1,000,000 in premium for

polices issued orrenewed in a given year. If they pay less than $1,000,000

in claims, they have made a profit. If they pay more than $1,000,000 is paid

in claims, they suffer a loss. Insurers have a unique way to earn massive

amounts of additional profit. Unlike many other types of businesses,

insurance companies collect huge sums of cash throughout the year and

may not have to pay on claims on those policies for many years.

Investment Income

This unique situation allows insurance companies to invest that money

while its not being used. Huge profits can be reaped, or lost, as a result.
http://www.thetruthaboutinsurance.com/insurance-claims/http://www.thetruthaboutinsurance.com/how-to-renew-your-car-insurance/http://www.thetruthaboutinsurance.com/how-to-renew-your-car-insurance/http://www.thetruthaboutinsurance.com/insurance-claims/


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This is exactly why Warren Buffet formed the Berkshire Hathaway Insurance

Companyso he could generate capital to invest in the stock market.

In fact, insurance companies can knowingly charge too little for insurance

policies and plan for an underwriting loss if they believe they can make a

profit from investing the money they receive before having to pay claims. In

the early 2000s, when the stock market was booming, this practice was

taking place.

On the flip side, insurance rates may be raised to make up for stock

market losses.

Additionally, some insurance companies may enter a new line of

insurance or a new state and purposely charge less than their competitors,

causing an underwriting loss, simply to make a name for themselves. Then,

the following year, raise their rates and hope to hang on to some of the

business they wrote.


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At its core, insurance is all aboutmanaging risk . Driving a car is risky.

Most people do not have the funds to pay for vehicle damage and medical

bills from a serious car accident. Insurance companies take on that risk and

cover the customers expenses in the case of a covered event. In return, the

insurance company collects a monthly premium from the customer. This

money provides a pool of funds used to pay out customers and the customer

gets peace of mind. This is ultimately the insurance companys bread and

butter: managing risk on behalf of their customers.

For any business to be profitable, income must be greater than

expenses. Insurance companies receive income in the form of monthly

premiums and investment returns. Their main expense is paying for covered

losses.For example , Wellpoint, which is one of the largest health insurance

companies in the country, made about $57 million in revenue from collected

premiums in 2008. The amount of health benefits paid out to customers that

year was about $44 million, which is about 84% of their premium revenue.

This makes the underwriting process a key component for any successful

insurance company. Underwriting is the process of evaluating the risk that

each prospective client poses. There are actuaries who pore over endless

amounts of demographic data to determine if the company should take on

the client on and how much they should charge the client to remain

profitable. A good underwriting process will allow the insurance company to

minimize the amount of money it pays out in losses.
http://www.investopedia.com/university/insurance/insurance2.asphttp://economix.blogs.nytimes.com/2009/09/25/how-much-money-do-insurance-companies-make-a-primer/?_r=1http://economix.blogs.nytimes.com/2009/09/25/how-much-money-do-insurance-companies-make-a-primer/?_r=1http://www.investopedia.com/university/insurance/insurance2.asp


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Working in the insurance industry is potentially very profitable, but

there are certain steps to take if you decide to sell insurance. Starting an

insurance company is not as easy as hanging a shingle in front of an office.

The insurance industry is highly regulated, and regulations vary from state

to state. The best thing to do is to check with your states insurance

commissioner office to find out what steps to take in order to become an

independent insurance agent. One thing that is required to start an

insurance agency is errors and omissions insurance, which is specialized

liability insurance for businesses that goes beyond traditional business

coverage.

As mentioned previously, the job of an insurance company is to

manage risk. This is true for a large insurance company as well as an

independent agency. But what happens when insurance companies feel they

have too much risk? This is where something calledreinsurance comes into

play, which essentially is insurance for insurance companies. An insurer may

have too much risk in their portfolio and will decide to transfer it to another

party, in this case the reinsurance company. This company will take on a

portion of the risk in exchange for the money the original insurer received.

By spreading risks across different institutions, insurance companies are

protecting themselves by not letting one small part of their portfolio destroy

their finances.
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Policies and Laws

An Insurance company adapts to the policies and Laws based in its

country of incorporation. Therefore, different country differs in their

insurance laws.

Common lawjurisdictions in former members of the British Empire,

including the United States, Canada, India, South Africa, and Australia

ultimately originate with the law of England and Wales. What distinguish

common law jurisdictions from their civil law counterparts are the concept

ofjudge-made law and the principle ofstare decisis - the idea, at its

simplest, that courts are bound by the previous decisions of courts of the

same or higher status. In the insurance law context, this meant that the

decisions of early commercial judges such as Mansfield,Lord Eldon and

Buller bound, or, outside England and Wales, were at the least highly

persuasive to, their successors considering similar questions of law.

At common law, the defining concept of a contract of commercial

insurance is of a transfer of risk freely negotiated between counterparties of

similar bargaining power, equally deserving (or not) of the courts'

protection. The underwriter has the advantage, by dint of drafting the policy

terms, of delineating the precise boundaries of cover. The prospective

insured has the equal and opposite advantage of knowing the precise risk
https://en.wikipedia.org/wiki/Common_lawhttps://en.wikipedia.org/wiki/Judge-made_lawhttps://en.wikipedia.org/wiki/Stare_decisishttps://en.wikipedia.org/wiki/John_Scott,_1st_Earl_of_Eldonhttps://en.wikipedia.org/wiki/John_Scott,_1st_Earl_of_Eldonhttps://en.wikipedia.org/wiki/Stare_decisishttps://en.wikipedia.org/wiki/Judge-made_lawhttps://en.wikipedia.org/wiki/Common_law


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proposed to be insured in better detail than the underwriter can ever

achieve. Central to English commercial insurance decisions, therefore, are

the linked principles that the underwriter is bound to the terms of his policy;

and that the risk is as it has been described to him, and that nothing

material to his decision to insure it has been concealed or misrepresented to

him.

Incivil law countries insurance has typically been more closely linked

to the protection of the vulnerable, rather than as a device to encourage

entrepreneurialism by the spreading of risk. Civil law jurisdictions - in very

general terms - tend to regulate the content of the insurance agreement

more closely, and more in the favour of the insured, than in common law

jurisdictions, where the insurer is rather better protected from the possibility

that the risk for which it has accepted a premium may be greater than that

for which it had bargained. As a result, most legal systems worldwide apply

common-law principles to the adjudication of commercial insurance disputes,

whereby it is accepted that the insurer and the insured are more-or-less

equal partners in the division of the economic burden of risk.

Insurable interest and indemnity

Most, and until 2005 all, common law jurisdictions require the insured

to have an insurable interest in the subject matter of the insurance. An

insurable interest is that legal or equitable relationship between the insured

and the subject matter of the insurance, separate from the existence of the
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insurance relationship, by which the insured would be prejudiced by the

occurrence of the event insured against, or conversely would take a benefit

from its non-occurrence. Insurable interest was long held to be morally

necessary in insurance contracts to distinguish them, as enforceable

contracts, from unenforceable gambling agreements (binding "in honor"

only) and to quell the practice, in the seventeenth and eighteenth centuries,

of taking out life policies upon the lives of strangers. The requirement for

insurable interest was removed in non-marine English law, possibly

inadvertently, by the provisions of theGambling Act 2005. It remains a

requirement in marine insurance law and other common law systems,

however; and few systems of law will allow an insured to recover in respect

of an event that has not caused the insured a genuine loss, whether the

insurable interest doctrine is relied upon, or whether, as in common law

systems, the courts rely upon the principle of indemnity to hold that an

insured may not recover more than his true loss.

Utmost good faith

The doctrine ofuberrimae fides - utmost good faith - is present in the

insurance law of all common law systems. An insurance contract is a

contract of utmost good faith. The most important expression of that

principle, under the doctrine as it has been interpreted in England, is that

the prospective insured must accurately disclose to the insurer everything

that he knows and that is or would be material to the reasonable insurer.
https://en.wikipedia.org/wiki/Gambling_Act_2005https://en.wikipedia.org/wiki/Uberrimae_fideshttps://en.wikipedia.org/wiki/Uberrimae_fideshttps://en.wikipedia.org/wiki/Gambling_Act_2005


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Something is material if it would influence a prudent insurer in determining

whether to write a risk, and if so upon what terms. If the insurer is not told

everything material about the risk, or if a material misrepresentation is

made, the insurer may avoid (or "rescind") the policy, i.e. the insurer may

treat the policy as having been void from inception, returning the premium

paid.Reinsurance contracts (between reinsurers and insurers/cedents)

require the highest level of utmost good faith, and such utmost good faith is

considered the foundation of reinsurance. In order to make reinsurance

affordable, a reinsurer cannot duplicate costly insurer underwriting and claim

handling costs, and must rely on an insurers absolute transparency and

candor. In return, a reinsurer must appropriately investigate and reimburse

an insurers good faith claim payments, following the fortunes of the cedent

Warranties

In commercial contracts generally, a warranty is a contractual term,

breach of which gives right to damages alone; whereas a condition is a

subjectivity of the contract, such that if the condition is not satisfied, the

contract will not bind. By contrast, a warranty of a fact or state of affairs in

an insurance contract, once breached, discharges the insurer from liability

under the contract from the moment of breach; while breach of a mere

condition gives rise to a claim in damages alone
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Regulation of insurance companies

Insurance regulation that governs the business of insurance is typically

aimed at assuring the solvency of insurance companies. Thus, this type of

regulation governs capitalization, reserve policies, rates and various other

"back office" processes.

European Union

Member States of the European Union each have their own insurance

regulators. However, the E.U. regulation sets a harmonized prudential

regime throughout the whole Union. As they are submitted to harmonized

prudential regulation, and in consistency with the European Treaty

(according to which any legal or natural person who is a citizen of a Union

member State is free to establish him-, her- or itself, or to provide services,

anywhere within the European Union), an insurer licensed in and regulated

by e.g. the United Kingdom's financial services regulator, theFinancial

Services Authority,may establish a branch in, and/ or provide cross-border

insurance coverage (through a process known as "free provision of

services") into, any other of the member States without being regulated by

those States' regulators.
https://en.wikipedia.org/wiki/Financial_Services_Authorityhttps://en.wikipedia.org/wiki/Financial_Services_Authorityhttps://en.wikipedia.org/wiki/Financial_Services_Authorityhttps://en.wikipedia.org/wiki/Financial_Services_Authority


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India

The insurance sector went through a full circle of phases from being

unregulated to completely regulate and then currently being partly

deregulated. It is governed by a number of acts. The first statute in India to

regulate the life insurance business was the Indian Life Assurance

Companies Act, 1912. The Insurance Act of 1938 was the first legislation

governing all forms of insurance to provide strict state control over

insurance business. Life insurance in India was completely nationalized on

January 19, 1956, through the Life Insurance Corporation Act. All 245

insurance companies operating then in the country were merged into one

entity, theLife Insurance Corporation of India.

The General Insurance Business Act of 1972 was enacted to

nationalize the about 100 general insurance companies then and

subsequently merging them into four companies. All the companies were

amalgamated into National Insurance, New India Assurance, Oriental

Insurance and United India Insurance, which were headquartered in each of

the four metropolitan cities.

Until 1999, there were no private insurance companies in India. The

government then introduced the Insurance Regulatory and Development

Authority Act in 1999, thereby de-regulating the insurance sector and

allowing private companies. Furthermore, foreign investment was also

allowed and capped at 26% holding in the Indian insurance companies. In
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2015 the limit of FDI in insurance sector has been raised to 49% subject to

certain conditions.

In 2006, the Actuaries Act was passed by parliament to give the

profession statutory status on par with Chartered Accountants, Notaries,

Cost & Works Accountants, Advocates, Architects and Company Secretaries.

A minimum capital of US$80 million (400 Crore) is required by legislation

to set up an insurance business.

United States

As a preliminary matter, insurance companies are generally required

to follow all of the same laws and regulations as any other type of business.

This would include zoning and land use, wage and hour laws, tax laws, and

securities regulations. There are also other regulations that insurers must

also follow. Regulation of insurance companies is generally applied at State

level and the degree of regulation varies markedly between States.

Regulation of the insurance industry began in theUnited States in the

1940s, through severalUnited States Supreme Court rulings. The first ruling

on insurance had taken place in 1868, with the Supreme Court ruling that

insurance policy contracts were not in themselves commercial contracts and

that insurance was not subject to federal regulation. This "judicial accident",

as it has been called, influenced the development of state-level insurance

regulation. This stance did not change until 1944 when the Supreme Court
https://en.wikipedia.org/wiki/United_Stateshttps://en.wikipedia.org/wiki/United_States_Supreme_Courthttps://en.wikipedia.org/wiki/United_States_Supreme_Courthttps://en.wikipedia.org/wiki/United_States


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upheld a ruling stating that policies were commercial, and thus were

regulatable as other similar contracts were.

In theUnited States each state typically has astatute creating an

administrative agency. These state agencies are typically called the

Department of Insurance, or some similar name, and the head official is the

Insurance Commissioner, or a similar titled officer. The agency then creates

a group of administrative regulations to govern insurance companies that

are domiciled in, or do business in the state. In theUnited States regulation

of insurance companies is almost exclusively conducted by the several states

and their insurance departments. The federal government has explicitly

exempted insurance from federal regulation in most cases. In the case that

an insurer declaresbankruptcy, many countries operate independent

services and regulation to ensure as little financial hardship is incurred as

possible.

In the United States and other relatively highly regulated jurisdictions,

the scope of regulation extends beyond the prudential oversight of insurance

companies and their capital adequacy, and include such matters as ensuring

that the policy holder is protected againstbad faith claims on the insurer's

part, that premiums are not unduly high (or fixed), and that contracts and

policies issued meet a minimum standard. A bad faith action may constitute

several possibilities; the insurer denies a claim that seems valid in the

contract or policy, the insurer refuses to pay out for an unreasonable
https://en.wikipedia.org/wiki/United_Stateshttps://en.wikipedia.org/wiki/Statutehttps://en.wikipedia.org/wiki/United_Stateshttps://en.wikipedia.org/wiki/Bankruptcyhttps://en.wikipedia.org/wiki/Bad_faithhttps://en.wikipedia.org/wiki/Bad_faithhttps://en.wikipedia.org/wiki/Bankruptcyhttps://en.wikipedia.org/wiki/United_Stateshttps://en.wikipedia.org/wiki/Statutehttps://en.wikipedia.org/wiki/United_States


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amount of time, the insurer lays the burden of proof on the insured - often

in the case where the claim is unprovable. Other issues of insurance law may

arise whenprice fixing occurs between insurers, creating an unfair

competitive environment for consumers. A notable example of this is

whereZurich Financial Services - along with several other insurers - inflated

policy prices in ananti-competitive fashion. If an insurer is found to be guilty

of fraud or deception, they can be fined either by regulatory bodies or in a

lawsuit by the insured or surrounding party. In more severe cases, or if the

party has had a series of complaints or rulings, the insurer's license may be

revoked or suspended. It should be noted that bad faith actions are

exceedingly rare outside the United States.

Rest of World

Every developed sovereign state regulates the provision of insurance

in different ways. Some regulate all insurance activity taking place within the

particular jurisdiction, but allow their citizens to purchase insurance

"offshore". Others restrict the extent to which their citizens may contract

with non-locally regulated insurers. In consequence, a complicated muddle

has developed in which many international insurers provide insurance

coverage on an unlicensed or "non-admitted" basis with little or no

knowledge of whether the particular jurisdiction in or into which cover is

provided is one that prohibits the provision of insurance cover or the doing

of insurance business without a license.
https://en.wikipedia.org/wiki/Price_fixinghttps://en.wikipedia.org/wiki/Zurich_Financial_Serviceshttps://en.wikipedia.org/wiki/Anti-competitive_behaviorhttps://en.wikipedia.org/wiki/Anti-competitive_behaviorhttps://en.wikipedia.org/wiki/Zurich_Financial_Serviceshttps://en.wikipedia.org/wiki/Price_fixing


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The Tax System

The taxation of Insurance Companies varies to its country of residence

and the countries to where it transacts its business.

The primary and predominant business activity of an insurance

company is the writing of insurance or the reinsuring of risks underwritten

by insurance companies, which are subject to the supervision by the

Insurance Commission.

It is in the nature of insurance companies to be constantly exposed to

the risks against which they contract to indemnify their clients. For the

assumption of risks, these companies engaged in the insurance business

receive, as consideration, premium payments from the insured.

Recently, the Bureau of Internal Revenue has come up with RMC 30-

08 and RMC 59-08 touching on the taxability of insurance companies for

minimum corporate income tax (MCIT), business tax, and documentary

stamp taxes (DST). The circulars clarify the scope of the taxability of

insurance companies to the above-mentioned taxes.

In the first circular issued, it was provided that for purposes of

computing the gross income on the sale of services which shall be the basis

of the 2-percent MCIT, the gross revenue of insurance companies shall


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include direct premium and reinsurance assumed (net of returns and

cancellations); miscellaneous income, investment income not subject to final

tax; released reserve; and all other items treated as gross income under the

tax code. Cost of services or direct cost and revenue-related deductions

were identified as those incurred costs which are exclusively related or

otherwise considered indispensable to the creation of the revenue from their

business activity as an insurance company, including the generation of

investment income not subject to final taxes, and shall be limited to: (a)

claims, losses, maturities and benefits net of reinsurance recoveries; (b)

additions required by law to reserve fund; and (c) reinsurance ceded. RMC

59-08 was later issued which expanded the cost of services to include: (a)

salaries, wages and other employee benefits of personnel directly engaged in

underwriting, claims and benefits, actuary and policy owner services; (b)

commissions on direct writings/reinsurance; (c) cost of facilities directly

utilized in providing the service such as depreciation or rental of equipment

used and cost of supplies; and (e) and inspection and medical fees. The

amendatory circular further clarified that investment expenses should not

form part of the direct cost nor be a deductible expense in the determination

of the net taxable income of life and nonlife insurance companies. However,

in the case of investment expenses relating to investment income that has

not been subjected to final tax, the same shall be allowed as deduction to


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arrive at the taxable income although they do not form part of the direct

cost.

For their various business-related activities, life-insurance companies

may be subject to business tax (value-added tax [VAT] or premium tax) and

documentary stamp tax. Thus, under RMC 59-08, direct writings or

premiums are to be subjected to the 5-percent premium tax same as

premiums on health and accident insurance, whether received by a life or

nonlife insurance company, which should be considered as premium on life

insurance and, therefore, likewise subject to premium taxnot VAT.

For unrelated services such as management fees, rental income or any

other income earned by the life-insurance company from services which can

be pursued independently of the insurance business activity, these are not

subject to the premium tax but subject either to VAT or percentage tax, as

the case may be. Also, the amendatory circular provides that re-issuance

fees, reinstatement fees, renewal fees, as well as penalties paid to life-

insurance companies shall be considered as income of life insurance

companies for services rendered to customers, which shall either be subject

to VAT or to percentage tax, whichever is applicable.

Investment income realized from the investment of premiums earned is

exempt from VAT or gross receipts tax. While investment income from

investment of funds obtained from others (solicited and pooled from


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policyholders) which are recognized by the insurance company as liabilities

and which are invested in marketable securities, instruments and other

financial products are considered income from quasi-banking functions, and

are, therefore, subject to gross receipts tax. Likewise, funds invested in

other financial products and in real estate are also considered income from

quasibanking activities or similar banking activities, and are likewise subject

to the gross receipts tax.

As regards their liability to DST, RMC 59-08 clarified that life-insurance

policies are subject to DST under Section 183 of the Tax Code. For

certificates issued, DST under Section 188 of the Tax Code is imposed. For

group insurance policies issued, the premium collected therefrom is subject

to Section 183; while for the individual certificates issued to each and every

employee covered by the group insurance policy, the issuance is subject to

DST under Section 188.

With regard to health and accident-insurance policy issued whether

underwritten by a life or nonlife insurance company, the basis of the

payment of DST shall be Section 183 where previously under RMC 30-08,

the health and accident insurance policy was subject to DST under Section

185. With these provisions, the taxability of insurance companies, both the

life and nonlife industries, are clarified.


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General Registration Requirements

Aside from wages, employees are entitled to benefits as mandated by

law. Under thePhilippine Labor Code,there are six benefits employees are

entitled to: Social Security Systems (SSS) contribution, contribution to

National Health Insurance Program (NHIP) or Philhealth, contribution to

Home Development and Mutual Fund (HDMF) or Pag-ibig, 13th month pay,

service incentive leave and meal and rest periods.

The term employee denotes any person legally employed in the

Philippines, any person compulsorily covered by the GSIS under

theCommonwealth Act 186,or any person compulsorily covered by the SSS

underRepublic Act 1161.Such employee is automatically covered for these

government mandated employee benefits.

As an employer, whenever you hire a new employee, you are required

to update the following government agencies about his new employment:

Bureau of Internal Revenue (BIR)

Social Security System (SSS)

Philhealth Health Insurance Corporation (PHIC)

Home Development Mutual Fund (HDMF/Pag-ibig)
http://www.dole.gov.ph/labor_codeshttp://www.gsis.gov.ph/default.php?id=101http://philippinelaw.info/statutes/ra1161-social-security-law.htmlhttp://www.bir.gov.ph/http://www.sss.gov.ph/http://www.philhealth.gov.ph/http://www.pagibigfund.gov.ph/http://www.pagibigfund.gov.ph/http://www.philhealth.gov.ph/http://www.sss.gov.ph/http://www.bir.gov.ph/http://philippinelaw.info/statutes/ra1161-social-security-law.htmlhttp://www.gsis.gov.ph/default.php?id=101http://www.dole.gov.ph/labor_codes


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Here are the steps you need to do to ensure the employee is properly

reported to concerned government agencies.

Employee Registration

Bureau of Internal Revenue (BIR)

The first thing you need to do for your employees is update their

employment status at the BIR.

If the employee has noTIN yet, you need to require theemployee to

fileBIR Form 1902 to therevenue district office (RDO) where your

company is registered.

If the new employee has TIN No. with a previous employer registered

in the same RDO as your company, either your employee or HR

personnel needs to submitBIR Form 2305 to update his/her

information.

If the new employee already has a TIN No. but his/her previous

employer is registered in a different RDO as your company, then the

employee will need to submit aBIR Form 1905 in the RDO where his

previous employer is registered.
https://ereg.bir.gov.ph/ereg/welcome.dohttp://www.bir.gov.ph/index.php/registration-requirements/primary-registration/application-for-tin.htmlhttp://www.bir.gov.ph/index.php/registration-requirements/primary-registration/application-for-tin.htmlftp://ftp.bir.gov.ph/webadmin1/pdf/20511902.pdfhttp://www.bir.gov.ph/index.php/contact-us/directory/revenue-district-offices.htmlftp://ftp.bir.gov.ph/webadmin1/pdf/16072305.pdfftp://ftp.bir.gov.ph/webadmin1/pdf/21351905.pdfftp://ftp.bir.gov.ph/webadmin1/pdf/21351905.pdfftp://ftp.bir.gov.ph/webadmin1/pdf/16072305.pdfhttp://www.bir.gov.ph/index.php/contact-us/directory/revenue-district-offices.htmlftp://ftp.bir.gov.ph/webadmin1/pdf/20511902.pdfhttp://www.bir.gov.ph/index.php/registration-requirements/primary-registration/application-for-tin.htmlhttp://www.bir.gov.ph/index.php/registration-requirements/primary-registration/application-for-tin.htmlhttps://ereg.bir.gov.ph/ereg/welcome.do


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Philippine Health Insurance Corporation (PHIC)

The Philippine Health Insurance Corporation is the medical insurance

company of the Philippines. All employees are required to be contributors of

this service (Republic Act 7875). Members are given health and

hospitalization subsidies should they or a dependent be

hospitalized. Monthly contributions are based on actual employee monthly

salaries and the amount of employee contribution is matched equally by the

employer.

For Employees:

Each new employee will need to fill up and sign aPHIC form PMRF regardless

if the employee is already a PHIC member or not. For PHIC members, they

need to submit to you their Philhealth ID number. A filled-out form should be

submitted in the PHIC office where your company is registered.

For Employers:

You will also need to fill up and submit aPHIC Form ER2 that contains the

list of your new employees. The PHIC Form ER2 should be submitted in the

PHIC office where your company is registered or you can submit it online

through their online portal.
http://www.chanrobles.com/legal4nhia.htmhttp://www.philhealth.gov.ph/downloads/membership/pmrf_revised.pdfhttp://www.philhealth.gov.ph/downloads/employer/er2.pdfhttp://www.philhealth.gov.ph/downloads/employer/er2.pdfhttp://www.philhealth.gov.ph/downloads/membership/pmrf_revised.pdfhttp://www.chanrobles.com/legal4nhia.htm


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Social Security System (SSS)

All employees hired by private companies are required to become an

SSS member (Republic Act No. 8282). This system aims to protect its

members for when they are unable to work such as sickness, disability,

maternity, old age and death, or other such contingencies not stated but will

result in loss of income or result to a financial burden.

The amount of SSS monthly contribution is determined from the actual

monthly salary an employee receives 30% of total monthly contribution is

deducted from an employees salary, while 70% is subsidized by the

employer.

Before you can update your employees SSS, you need to ask for your

employees SSS No. If your new employee is not yet an SSS member, you

should require him/her toregister in the SSS office where your company is

registered.

You as employer will also need to fill up and submit an SSS Form R1A

that contains the list of your new employees with their respective SSS No.

The SSS Form R1A should be submitted in the SSS office where your

company is registered or you can also do it online using their online portal

for employers.
http://www.chanrobles.com/legal4sss.htmhttp://www.sss.gov.ph/sss/index2.jsp?secid=109&cat=2&pg=nullhttp://www.sss.gov.ph/sss/index2.jsp?secid=109&cat=2&pg=nullhttp://www.chanrobles.com/legal4sss.htm


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Home Development Mutual Fund (HDMF)

Employers are also required to contribute, on behalf of their

employees, to the Home Development Mutual Fund (Republic Act

7835). Also known as the Pag-ibig Housing Development Program, this

government agency provides the lowest interest housing and land acquisition

loans to its members that are payable for up to 30 years. This gives every

Filipino worker an opportunity to own a house in easy-payment plans that

can directly be deducted from their monthly wages.

For new employees, they can register as a new memberonline. All

your new employees can be easily updated through thePag-ibig online web

portal. Or you can just add the employee in theHDMF Form MCRF, and then

mark as NH (Newly Hire), when you are filing the monthly HDMF

contribution.
http://www.chanrobles.com/republicactno7835.htmhttp://www.chanrobles.com/republicactno7835.htmhttps://www.pagibigfundservices.com/pubreg/starter_page.aspxhttps://www.pagibigfundservices.com/EmployerRegistration_Public/https://www.pagibigfundservices.com/EmployerRegistration_Public/http://www.pagibigfund.gov.ph/dlforms/provident/PFF053_MembersContributionRemittanceForm_V02.pdfhttp://www.pagibigfund.gov.ph/dlforms/provident/PFF053_MembersContributionRemittanceForm_V02.pdfhttps://www.pagibigfundservices.com/EmployerRegistration_Public/https://www.pagibigfundservices.com/EmployerRegistration_Public/https://www.pagibigfundservices.com/pubreg/starter_page.aspxhttp://www.chanrobles.com/republicactno7835.htmhttp://www.chanrobles.com/republicactno7835.htm


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BDO Offices


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Reference(s):

Camora, G. A. (n.d.). taxation of insurance companies. BDBLAW, pp. 1-5.

class notes. (n.d.). Retrieved from insurance business environment:

http://nakulanand.in/files/documents/insurance-business-

environment---an-introduction.pdf

Full suite Corporation. (n.d.). An Employer's guide to registering employees

in the Philippines. Retrieved from Full suite: http://full-

suite.com/blog/employers-guide-registering-employees-philippines/

How do Insurance companies make money. (2008). Retrieved from the truth

about insurance: http://www.thetruthaboutinsurance.com/how-do-

insurance-companies-make-money/

HUssain, S. (n.d.). The secret to how insurance companies make their

money. Retrieved from http://insurance.credio.com/stories/3670/how-

insurance-companies-make-money

Wikipedia. (2015). Insurance Law. Retrieved from wikipedia:

https://en.wikipedia.org/wiki/Insurance_law

Documents

INSURANCE-CORPORATION.pdf