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TABLE OF CONTENTS. PAGE. #.

EXCUTIVE SUMMARY 7

1 WHY INDUSTRY CHOSEN: 8

2 LITRATURE REVIEW 10

2.1OBJECTIVES OF SLIC 12

2.2MISSION OF SLIC 13

2 .3V IS IO N OF THE COMPANY 1 3

3 MARKETING MIX 19

3.1 PRODUCT 19

3.2 PLACE 20

3.3 PRICING STRATEGIES 21

3.4 PROMOTION 23

3.5 BRANDS 24

3.6 SERVICES 27

4 JOB DESCRIPTION 31

4.1 JOB TITLE 31

4.2 JOB SPECIFICATION 31

4.3 JOB DESCRIPTION 31

4.4 JOB RESPONSIBILITIES 35

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5 SWOT & PEST ANALYSIS 38

5.1 SWOT ANALYSIS 38

5.1.1 STRENGTH 38

5.1.2 WEAKNESSES 39

5.1.3 OPPORTUNITIES 42

5.1.4 THREATS 43

5.2 PEST ANALYSIS 44

5.2.1 POLITICAL FACTORS 44

5.2.2 ECONOMICAL FACTORS 44

5.2.3 SOCIAL CULTURAL FACTORS 44

5.2.4 TECHNOLOGICAL ANALYSIS 45

5.3 MARKET ANALYSIS BY USING BCG MATRIX. 45

6 CHALLENGES & RECOMMENDATION 49

6.1 CHALLENGES 49

6.2 LEARNINGS 50

6.3 RECOMMENDATION 50

7 BIBLOGRAPHY. 53

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INTERNSHIP REPORT ON

STATE LIFE INSURANCE

Shaigan Rana

Submitted in partial fulfillment of the requirements

For the degree of Bachelor of Business Administration

At

National University of Modern Languages

Islamabad, Pakistan

February 2011

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DEDICATION.

I dedicated my report and work to my parents and respected teachers, whose love and support

encouraged for me at every step of my life.

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ACKNOWLEDGEMENT

I offer my humblest thanks to ALMIGHTY ALLAH, The most Beneficent and the Most

Considerate and the entire source of all knowledge and wisdom.

My respectable advisor, whose blessings gave me the insight and knowledge not only to carry

out the jobs assigned to me but also to complete this report.

I am also grateful to all the staff members of State Life in completing my assignments and for

their kind cooperation during my internship, I offer special thanks to:

Mr. KHALID MANSOOR (zonal head)

Dr. Bahadur (manager)

Mr .Naeem Sheikh (Under-writer)

Mr. Ansar Khan (Area Manager)

There are many other people who have been very helpful to me right from the

beginning whose names can not be included due to the scarcity of space and time.

Shaigan Rana

BBA 8TH

1212

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STATE LIFE INSURANCE CORPORATION OF PAKISTAN

EXECUTIVE SUMMARY:

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To complete the BBA degree, the students are required to undergo for six weeks of

internship with an organization. The internship is to serve the purpose of acquainting the

students to professional atmosphere, as an intern. The main purpose of the study in hand is

together relevant information to compile internship report on that organization. To observe,

analyze and interpret the relevant data competently and in a useful manner.

I did my six weeks internship at STATE LIFE INSURANCE and worked in Marketing

Department, with Area manager, Under-writer and manager. My learning experience with

SLIC begins with my joining from 24-12-10. My internship report contains all the information

about my work experience with SLICE.

In this report, I discussed different features of this Insurance Company. All the details

regarding its working, insurance plans, benefits, services, packages etc are given. I worked in

Islamabad Zone.. The atmosphere in all departments was very friendly & co-operative, which

really motivated me to work hard and finish my daily tasks on time. I have also enhanced my

intellectual skills, which would be very helpful for me in future.

CHAPTER.2 LITRATURE REVIEW:

The state life insurance corporation consists of Zonal offices in all important towns,

Regional Offices and a Principal office. The Zonal Offices deals exclusively with the sales and

marketing of policies underwriting of Life Insurance Policies and the policyholder services.

Regional offices ( South , North ,Central & Multan ) each headed by regional Chief who

supervises business activities of the zones in their Region effectively and the principal office,

based at Karachi, is responsible for activities such as Investment , Advertising , Sales

promotion , Real Estate , Actuarial and International Operations etc.

The chief Executive of the corporation is Chairman, who is presently assisted by three

Executives Directors. State Life effectively providing life insurance cover to cater to individual

needs of the country's peoples through an organized and professionally trained field force

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comprising several thousand field workers and field supervisors. The policies issued by the

state life are backed by the life fund exceeding Rs. 94 billion at the end of 2003. In addition,

the government of Pakistan grantees all individual life insurance policies. State Life's

performance both in individual and pension, has been characterized by exemplary growth,

brought about by the concerned efforts of its dedicated employees and member for its dynamic

field force, under the guidance of a top management comparing men with a vision and wisdom.

State Life offers a large number of plans for the benefits of Pakistani families.

Financial protection against loss or harm

Insurance, in law and economics, is a form of risk management primarily used to hedge against

the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a loss,

from one entity to another, in exchange for a premium, and can be thought of as a guaranteed

small loss to prevent a large, possibly devastating loss. An insurer is a company selling the

insurance; an insured is the person or entity buying the insurance. The insurance rate is a factor

used to determine the amount to be charged for certain

The insurance contract is a contract whereby the insurer will pay the insured (the

person whom benefits would be paid to, or on the behalf of), if certain defined events occur.

Subject to the "fortuity principle", the event must be uncertain. The uncertainty can be either as

to when the event will happen (i.e. in a life insurance policy, the time of the insured's death is

uncertain) or as to if it will happen at all (i.e. a fire insurance policy).

Insurance contracts are generally considered contracts of adhesion because the insurer draws

up the contract and the insured has little or no ability to make material changes to it. This is

interpreted to mean that the insurer bears the burden if there is any ambiguity in any terms of

the contract.

Insurance contracts are unilateral, meaning that only the insurer ma+es legally

enforceable promises`in the contract. The insured is not required to pay the premiums, but the

insurer is required to pay the benefits under the contract if the insured has paid the premiums

and met certain other basic provisions.

Insurance contracts are governed by the principle of utmost good faith which requires

both parties of the insurance contact to deal in good faith and in particular it imparts on the

insured a duty to disclose all material facts which relate to the risk to be covered. This contrasts

with the legal doctrine that covers most other types of contracts, caveat emptor.

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There should be a certain definite loss taken place at a known time, in a known place and

from a known cause. Therefore the time, place and the cause of loss should be clear enough.

The incident that represent the cause of the claim should be accidental or beyond the control of

the beneficiary

The size of the loss must be significant from the perspective of the insured.

Insurance premiums should cover both the estimated cost of losses, plus the cost of policy,

regulating the losses, and providing the principal required to logically assure that the insurer

would be able to reimburse claims. The amount of premium should be affordable. The

possibility of loss and the cost of compensation should be calculable or estimable.

People have many choices while buying insurance policies. They commonly chose an

insurance provider based on several criteria. Some of the most important of these include:

1. The financial stability of the insurance company.

2. The price of policies.

3. Detail coverage and service.

To ensure satisfaction of our valued policy holders in processing new business

providing after sales services and optimizing return on life fund through a quality culture and

to maintain ourselves leading life insurance in Pakistan.

2.1OBJECTIVES OF SLIC

Following are the objectives of SLIC.

To run life insurance business in sound lines,

To provide more efficient services to policyholder,

To maximize the return to policyholders by economizing on expenses and increasing

the yield on investment,

To make life insurance a more effective means of mobilizing national savings,

To widen the area of operation of life insurance and making it available to as large a

section of the population as possible, extending into from he comparatively more

efficient sections of society to the common man in town and villages, to use the policy

holders funds in the wider interest of the community.

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2.2MISSION OF STATE LIFE INSURANCE CORPORATION

To remain the leading insurer in the country by extending the benefits if insurance to all

sections of society and meeting our commitments to our policy holders and the nation.

2.3VISION OF THE COMPANY

The most successful and admired life insurance company, which mean that we are the

most trusted company, the easiest to deal with, offer the best value for money, and set the

standards in the industry.

The most obvious choice of all.

.

CHAPTER1. Why industry chosen:The reason that I have chosen this industry is that it works with the customer directly. I

am being the student of marketing this was an opportunity for me to work and test all the

things that I have learned. Working in this industry has helped me to apply every concept of

marketing that I have learned in my course. Why I worked in this industry is that their work is

interesting, what they have to do is to grab the big clients from the market who gave 50% to

60% of your total revenue.

Working in SLIC was quite challenging and the department in which I worked was related to

my field of specialization which is marketing. As it is a services industry is this type of

industry organizations have direct relations with the customers and I being the marketing

student had a chance to work with my customers and know about their demands we have to

schedule meetings with them and gave them presentations about our services it helped me to

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apply the concepts of marketing which I learned in books in real life. I got a chance to see

those concepts working in real market environment.

The major function of the State Life Insurance Corporation Of Pakistan is to carry

out Life Insurance Business , however it is also involved in the related business activities such

as investment of policyholder , fund in Government securities , stock market , real estate etc.

The major achievements of the State Life are as under.

On the commencement of the operations the Corporation took a very important step by

effecting reduction up to 33 % in the premiums on the past an potential life policies for the

benefit of the policyholders. State Life is profitable organization and it paid Rs.1.729 billion as

dividend to the Government of Pakistan since its inception in 1972.

State Life has played very vital role in the economy by providing employment to the people of

the country as permanent employees and as part of its marketing force and by investing the

huge funds in different sectors of the economy. Investment portfolio in 2008 is 182,874.2

million.

The premium income increased from Rs.0.317 billion in 1972 to 22.695 billion in 2008.

Investment income including rental income increased from Rs. 0.81 billion in 1972 to Rs.

19.134 billion in 2008.

Total statutory fund of state life stands at Rs. 177.459 billion in 2008 as against Rs.

1.494 billion in 1972.

First time in the history of state life 175 area managers have completed of Rs. One

billion in the year 2008 to 2009.

State Life is monthly striving towards its objectives of making life insurance available to large

section of the society by extending it to common man.

CHAPTER3. ABOUT THE ORGANIZATION:

3.1 HISTORY OF STATE LIFE INSURANCE IN PAKISTAN:

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Before partition, there were only three major insurance companies named Christian

Mutual, Muslim a Show Desktop.scfnd Eastern Federal Union transacting life insurance through

their Head Office in the ears, which ultimately formed Pakistan. The need for having a

composite insurance company particularly for Muslims was felt by some of the eminent

Muslim personalities. And Eastern Federal Union Insurance Company was established in 1932

by the struggle of those Muslim personalities. The Muslim Insurance Company of Pakistan

was established in 1949.

Before the nationalization of companies in 1972, there was a big competition between

companies involved in life insurance business in Pakistan as there were more than thirty

companies offering the insurance facility. Upon nationalization of life insurance business in1972, State Life Insurance Corporation was formed to take entire liabilities and assets as they

related to life insurance business. Starting with three units A, B and C, it was soon merger into

a single corporation. Now State Life Insurance Corporations are working in different parts of

the country with Head Office at Karachi.

In Pakistan, life insurance business was nationalized by Govt., Order in March 19, 1972

and in fact this was an important step toward economic development in the history of Pakistan.

The nationalized process was completed in two phases. In first phase (March 19, 1972),

the Govt. has taken over the administration of 32 companies. After this, these were handed

over to trustee and sub-trustee in accordance to life insurance nationalization order 1972.

In the second phase of nationalization (November 1, 1972) a single corporation, having

three units, came into existence by the name of State Life Insurance Corporation (SLIC) of

Pakistan. These three units, constituted by merging of one or more insurance companies, were

named as A, B and C units. For further improvement of the life business in Pak, these units (A,

B & C) were merged together and converted into zones.

SLIC has enjoyed a complete monopoly the life business till 1990 when the

Government, had decided to open it to local private sector insurers. At present, besides SLIC,

there are four other life insurers operating in the country including two foreign companies. The

state Life Insurance Corporation is reinsured by foreign insurance Swiss RE (Switzerland).

3.2 SCOPE OF INSURANCE.

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Sometimes in life it is not possible to avoid the losses. For example People may

become ill. They may die of illness or accidents or their homes or other property may undergo

damage or theft. So in all these cases and they have to face the loss of income or savings. So

insurance is a manner of financially insuring that if such an incident comes about then the loss

does not affect the present well being of the person. The scope of the insurance is as follows.

1. There should be a certain definite loss taken place at a known time, in a known place

and from a known cause. Therefore the time, place and the cause of loss should be clear

enough.

2. The incident that represent the cause of the claim should be accidental or beyond the

control of the beneficiary.

3. The size of the loss must be significant from the perspective of the insured. Insurance

premiums should cover both the estimated cost of losses, plus the cost of policy, regulating the

losses, and providing the principal required to logically assure that the insurer would be able to

reimburse claims.

4. The amount of premium should be affordable.

5. The possibility of loss and the cost of compensation should be calculate able and

estimate able.

3.3 TYPES OF INSURANCE

3.3.1 LIFE INSURANCE.Life insurance policy insures the life of the insured. The insurance company is legally

bound to provide a monetary benefit to a decedent's family or the beneficiary after the death of

the policyholder. The proceeds are paid to the beneficiary either in a lump sum amount or an

annuity

3.3.2 MEDICAL INSURANCE

Medical insurance is also called med claim. Under this policy the insurance policy pays

the amount to the insured for his health purpose. This amount covers the cost of medical

treatment.

3.3.3 DISABILITY INSURANCE.

There is two types of disability insurance. One is simple disability insurance and the

other is total disability insurance. In case of simple disability insurance, a financial support on

monthly basis is provided by the insurer to the policy holder if he is unable to work due to an

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injury or an illness. But permanent disability insurance provides the reimbursement if a person

becomes permanently disabled.

3.3.4 GENERAL INSURANCE

It includes automobiles insurance, business insurance, property insurance etc.

3.3.5 AUTOMOBILE INSURANCE.

In UK this insurance is called motor insurance. It compensates the loss or damage

occurred to the vehicle. But in United States auto insurance policy is essential to legally

operate a vehicle on public roads.

3.3.6 BUSINESS INSURANCE.

Business insurance protects the businesses against risks of losses and damages and

compensates in case of loss

3.3.7 PROPERTY INSURANCE

This type of insurance protects the property against the risks like fire, theft etc. This

category also includes fire insurance, flood insurance, earthquake insurance etc

3.3.8 FIRE INSURANCE

It is an insurance covering the damage to the property caused by fire.

This type of insurance pays the policy holder in case of any loss or damage to the

property due to flood. It protects the property against the flooding.

3.4 PLACE.

Regional

Off ice

Zonal Off ice

CENTRAL

REGION

Lahore(Central),Lahore

(Western),Faisalabad,

S a r godha ,Gur j r anwal a ,S i a l ko t .

SOUTHERN

REGION

Kar ach i ( S ou t he r n )

Kar ach i ( Eas t e r n ) ,Kar ach i

( Cen t r a l ) , Hy der abadMi r - P ur - Khas ,La r kana ,

Que t t a

NORTHERN

REGION

Rawal p i nd i ,Mi r P ur I s l amabad ,P es hawar

Abbo t t abad , S wa t ,

Gu j a r a t .

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MULTAN

REGION

Mul t an , S ah i wa l ,Rah i m Yar Khan ,

Dear a Ghaz i Khan ,

Bahawal P ur .

3.5 PRICING STRATEGIES.

Premiums other than single premiums can be paid by the policyholders to State Life in

yearly, half-yearly, quarterly or monthly installments.

3.5.1 PRICES FOR LOAN AMOUNT.

Currently State Life is charging 10% interest on policy loans. Interest is payable half-

yearly.

3.5.2 IF LOAN IS NOT PAID.

If loan is not repaid during the term of the policy or early claim, the amount of loan

plus profit or return, if any, will be deducted from the claim money and the balance amount

will be paid to the person making the claim.

3.5.3 AUTOMATIC PAID UP OPTION.

This policy will be converted into a paid-up policy. The paid-up Sum Insured will be

specially calculated to allow for the clearance of all outstanding dues of State Life against the

policy. No further premium(s) will be payable but the sum insured will be reduced. Any

bonuses attached to the policy will be taken into consideration while determining the paid-up

sum insured. A policy once paid-up will not be entitled to any further bonuses. If the specially

calculated paid-up sum insured works out to be less than Rs.100/ the policy will not be

converted into paid-up but will be treated as having been forfeited losing all its benefits.

3.5.4 AUTOMATIC PREMIUM LOAN OPTION.

So long as the net surrender value of the policy equals or exceeds any due premium

remaining unpaid beyond its grace period, State Life will continue to keep this policy in full

force, and treat the said premium as paid by creating an automatic premium loan against the net

surrender value of the policy. When the net surrender value of the policy becomes less than a

due premium remaining unpaid beyond its grace period, the policy will be kept in full force for

a further broken period. This broken period will bear the same proportion to the full period of

the unpaid premium as the net surrender value bears to the unpaid premium. The policy; will

automatically be forfeited and lose all benefits at the expiry of the said broken period. Profit or

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return (however called or described) will be charged on automatic premium loan at rates

determined by State Life from time to time, so long as any automatic premium loan along with

profit or return (However called or described) is outstanding against this policy, any; payment

received by State Life will first be applied to reduce this debt.

3.5.5 INTEREST ON LOAN.

Employee Grade Loan % age Rate (interest)

1,2,3 Rs. 150000 6

4 to 7 Rs. 200000 6

7 & onward Rs. 2155000 (or 30 Basic

Pay whichever is high)

10

3.6 PROMOTION.

3.6.1 ELECTRONIC MEDIA.

State life makes their promotion campaign through the electronic media for this

purpose the mostly use the television and radio channels.

3.6.1.1 THROUGH TV CHANNELS.

State life makes their ads and run these ads on the TV and makes their ads so attractive

that they won the heart of the people.

3.6.1.2 THROUGH RADIO CHANNELS.

State life also uses the radio channels for supporting their products in the market. As

they have number of insurance schemes and through radio they organize different programs

that support their schemes. Now a day in Pakistan there is number of radio channels from AM

to FM .State life launched their programs on these channels whether it is AM or FM regarding

these schemes and through this way public knows lot about the State life and through this way

lot of people interested to get the policy from State Life.

3.6.2 THROUGH PAPER MEDIA.

State life also used paper media for their promotion activities. They published their ads

on different news paper like Dawn news, Daily Jang, and other weekly magazines.

3.6.3 CONDUCTING SEMINARS.

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State life also conducting seminars for their latest policy schemes and invite public to

know about their work and how they gave benefit to general public.

3.6.4 PERSONAL SELLING.

3.6.4.1 FACE TO FACE SELLING.

Much of the policies were generated by the face to face interaction with the people.

State Life agents contact with the people to give a brief description to the general public and

also give them a detail of their policies.

3.6.4.2 SUPPLIMENTRY ADVERTISING.

It includes different options for making their product advertisement such as bill board's

and creation of different banners etc.

3.7 BRANDS.

3.7.1 SADA BAHAR PLAN

Sada bahar is an anticipated endowment type with-profit plan that provides lump sum

benefit at certain stages during the premium-paying term or on earlier death. In addition, this

plan has a built-in Accidental Death Benefit (ADB) rider so that the policyholder gets an

additional sum assured in case of death due to an accident.

Admissible Ages and Terms. This plan is available to all members of the general

public, aged from 20 to 60 years nearest birthday. Both males and females purchase this plan.

Terms offered under this plan are 12, 15, 18, 21, 24, 27 and 30 years.

3.7.2 SHAD ABAD

Shad Abad Plan is an extended form of endowment assurance. The benefits under the

policy increase manifold in the event of death of the life insured. On completion of term of

policy, sum insured plus bonuses attached to the policy are payable. However, on death during

the policy term, the death benefit consists of double of sum insured with accrued bonuses.

Incase of death due to accident, the death benefit consists of four times the sum insured plus

bonuses. This plan meets the requirements of those who appreciate the basic savings purpose

of endowment assurance but also like some additional cover to protect loved ones in case they

die, Allah forbid, before maturity.

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3.7.3 JEEVAN SATHI

This is a joint life plan and covers lives of two partners say husband and wife

simultaneously. Premiums are payable till the end of the specified term or till death of either of

the insured persons, if earlier. The plan contains extensive benefits; an overview of which

appears as under:

On the death of the first life, the sum insured will be paid to the survivor. Further

premiums under the policy will be waived, but the insurance protection of the second life will

continue. Also, the policy will continue to participate in profits of the Corporation. On death of

the second life, again the sum insured will be paid together with the attaching bonuses. In this

event the policy will terminate.

If the second life survives the term of the policy, he or she will be paid sum insured

together with the attached bonuses, even though the sum insured has been paid once, on the

death of the first life. If both the lives survive the term of the policy, the sum insured will be

paid to them jointly, only once, together with the attached bonuses. Different supplementary

covers are also available for increasing coverage under the policy.

Jeevan Sathi Plan is best suited for those married couples who want to enjoy insurance

coverage for a comparatively lesser premium. Moreover, housewives who are otherwise not

insurable can also enjoy the benefits of insurance policy through this plan.

3.7.4 CHILD EDUCATION & MARRIAGEChild Education & Marriage Assurance is a plan for the protection of childs future. It

provides a lump sum benefit for the child at the completion of the policy term. On completion

of term of the policy, full sum insured together with the accrued bonuses become payable to

the policyholder. If the policyholder dies (Allah forbid) before completion of the term, a family

income benefit of Rs 240 per 1000 sum insured per annum is paid to the child until the

completion of policy term. Further, future premiums under the policy are waived and policy

remains in force with full sum insured and continues to participate in State Lifes surplus and

receive bonuses. Upon the completion of policy term, the child gets two options of either

getting the proceeds in a lump sum or in five equal installments.

3.7.5 SUNEHRI POLICY.

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Sunehri Policy is an innovative life insurance product. It is flexible, secure and meets

the challenges of inflation quite economically. Under a special feature of this plan, from third

policy year onwards, sum insured under the policy and premium will increase by 6% per

annum without providing any evidence of insurability. From the third policy year onward, the

policyholder is provided with a statement showing the build up of cash value of the policy and

sum insured for the year. The policy also participates in the surplus of State Life and currently

the rate of bonus is Rs 105 per thousand per annum of the adjusted opening cash value.

3.7.6 MUHAFAZ PLUS.

Muhafiz Plus provides a substantial sum of money on maturity or earlier death (Allah

forbid) of the life insured. On maturity, the policyholder will receive sum insured plus bonuses

attached with the policy.

However if the life insured dies before completion of term of the policy, basic sum

insured plus attached bonuses will be paid to the dependants immediately. In case of death due

to accident, the double of the sum insured is paid. In addition, the dependents will also be paid

an income of Rs 240 per thousand sum insured per annum for a fixed period of 15 years. The

first payment will fall due on the policy anniversary immediately after the death of the life

insured.

3.8 SERVICESIn services Supplementary Contracts are those contracts which make the insurance

more attractive. They provide certain incentives on certain situations. They make the plan

attractive in sense that if some one is purchasing supplementary contracts with a policy then he

will be awarded the officers of the supplementary contracts too along with policy or insurance

plans.

State Life offers a number of supplementary covers to enhance coverage under different

plans. These supplementary covers can be attached with the main policy and are not available

exclusively.

Accidental Death & Indemnity Benefit (AIB)

Accidental Death Benefit (ADB)

Family Income Benefit (FIB)

Waiver of Premium (WP)

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Special Waiver of Premium (SWP)

Term Insurance (TI)

Refund of Premium Rider (RPR)

3.8.1 ACCIDENT DEATH & INDEMNITY BENEFIT (AIB).

This supplementary cover provides for payment of additional amount equal to the sum

insured under the policy in the event of death by accidental means, or in the event of loss of

two or more limbs or loss of sight in both eyes. One-half of the sums insured will be paid for

loss of one limb; one-third of sum insured in the event of loss of one eye and one-fourth of sum

insured will be paid for loss of thumb and index finger. Moreover, weekly indemnities are also

available for total and partial disability of the life insured as a result of the accident. If the life

insured becomes permanent and total disable, an annuity of 10% of sum insured will be

payable for a maximum period of ten years.

AIB is suitable for office commuters and individuals who travel and use different

modes of transport. The rates of premium for this supplementary benefit range from Rs 4 to

Rs10 per thousand sum insured depending upon the occupational rating of proposed for

standard lives whose age should be between 18 to 55 years.

3.8.2 ACCIDENTAL DEATH BENEFIT (ADB)

This supplementary cover will provide for payment of an additional amount equal to

sum insured in the event of death by an accident as defined in the contract. On payment of amodest premium, a handsome accidental coverage is obtained through this supplementary

cover. ADB is highly recommended for individuals who travel daily through road transport.

The cover is available to lives between 5 and 55 years of ages. Maximum term of this

supplementary benefit is not allowed to exceed the premium paying term of the basic policy, or

60 years of age of the life proposed whichever is earlier.

3.8.3 FAMILY INCOME BENEFIT (FIB)

This supplementary cover provides that incase of death of the life insured during term

of this cover, an annuity of 10% to 50% per annum of the basic sum insured will be payable till

the completion of term of this cover. For instance, if a life insured has taken 25% FIB

supplementary cover for 20 years on his policy having sum insured of Rs 1,000,000. If the life

insured expires during term of FIB, say at the end of fourth year, an annual sum of Rs 250,000

will be payable for rest of 16 years.

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While the basic plan provides a lump sum, FIB provides a regular stream of income to

the dependents and helps in meeting the day to day expenses. This supplementary cover is

available to lives between 18 and 55 years of ages.

3.8.4 WAIVER OF PREMIUM (WP)

This supplementary cover provides for waiver of due premiums in the event of the life

insureds Total and Permanent Disability caused by accident as defined in the contract. With

the help of WP, the life insured gets relieved of vagaries of paying premiums incase of his or

her being incapacitated as a result of accident. The rate of premium for standard risk will be Rs

0.50 to 1.00 per thousand of sum insured depending upon the age of life insured.

3.8.5 SPECIAL WAIVER OF PREMIUM (SWP)

This supplementary cover will provide for waiver of premiums under the policy incase

of the life insureds Total and Permanent Disability due to accident or disease which renders

him unable to engage in any occupation.

With the help of SWP, the life insured gets relieved of vagaries of paying premiums

incase of his or her being incapacitated as a result of accident or disease. SWP is available to

lives between 20 and 55 years of ages.

3.8.6 TERM INSURANCE (TI)

In the event of death of the life insured during term of TI supplementary cover, the sum

insured will be payable in addition to the benefits payable under the basic policy. Suppose, Mr.

A, covered under a policy of Rs 1,000,000, and also attaches TI supplementary cover with his

policy. Incase of his death during term of TI, a sum equal to Rs 1,000,000 will be payable

under this supplementary cover. This will be in addition to the benefits payable under main

policy.

This supplementary cover is an excellent opportunity for individuals who want to

enhance coverage of their policy substantially on payment of a meager amount of premium. TI

is available to lives between 18 and 55 years of age

3.8.7 REFUND OF PREMIUM RIDER (RPR)

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RPR provides for refund of premiums paid under the policy in the event of death of the

life insured during term of the policy. It is an ideal form of enhancing the life cover under the

policy with a modest increase in premium.

This supplementary cover is available to lives between 20 and 60 years of ages. The

available term ranges from 10 to 25 years.

3.9 ORGANIZATION HIERARCHICAL STRUCTURE

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3.10 REGIONAL HIERARCHICAL STRUCTURE

3.11 AREA DEPARTMENT HIERARCHICAL STRUCTURE

- -

SALES

OFFICERS

SALES MANAGER

xxiii

ZONAL HEADS

SECTOR HEADS

REGIONAL CHIEFNREHTRON

REGANAM AERA

SALES

REPRESENTATIVES


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CHAPTER. 4 EXPERIENCE:

4.1 JOB TITLE.

- -

AREAMANAGER

SALES

MANAGERSALES

OFFICERS SALESREPRESENTATIVE

NTACCOUNTA

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Internee in the sales and marketing department

4.2 JOB SPECIFICATION.

The minimum requirement for this job was Bachelors/ preferably B-commerce but I am

a BBA (hons) marketing student doing Compulsory internship of 06 week.

4.3 JOB DESCRIPTION.

In my internship period I visited different departments of the State Life Insurance

Corporation and know the functional areas of these different departments.

4.4 POLICY HOLDER SERVICE DEPARTMENT

PHS is the abbreviation of "Policy Holder's Service" department. As the name

indicating that all the services for policy holder are performed here. We can also call

these services, after sale services. It is the busiest department of SLIC in each zone.

Every service process is taken very carefully in the last conference of SLIC. It was

announced that every service would be completed within 15 days. Otherwise State Life

pays restriction plenty to the policy holder. The head of PHS is also sits in Karachi. His

post is G.M.

Followings are the functions performed in PHS dep't.

4.4.1 CLAIM SECTION.

This section is always busy in entertaining claims of the policyholders. It has its

own investigators and they investigate all claims and then recommend that a claim

amount may be given to the nominees of the claimants or not. They also look into all

such maturity claims and those policies which fall, mature all payments and the claim

section of the policyholder services (PHS) give houses.

Claims Are Of Two Types:

Death Claim

Maturity

4.4.2 SURRENDER SECTION.

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This is also an important section of the PHS. All those do not want to continue policy

due to some financial or any other problem request and send their applications to PHS

surrender section. Then the staff of this section scrutinizes those applications and issue

surrender discharge vouchers of payment to the clients.

After receiving vouchers the account section issues cheques to the clients. It also issues

bones certificates to the policy holders and keeps their record in computers. Very technical and

professional staff has been recruited in this section.

4.4.3 PROCEDURE:

First the surrender section receives application from the policy holders a long with

other required documents like NIC etc.

Than this section issues surrender discharge vouchers, they calculate the cash value and

mentioned in this voucher, the policy he written and this voucher should also he signed by the

policy holder.

Then they send all these documents to audit department after making the audit, the

audit department again sends it's to surrender section (PHS).

If the amount is more than Rs. 10,000 then it is referred to account department, they

issues cheques, these cheques again come to (PHS) surrender section and they give it to policy

holders.

If amount is less than Rs. 10,000 then there is no need to send all the documents to

account department PHS directly issues cheques to the clients.

4.4.4 LOAN SECTION.

Other facility of SLIC is loaning. You can get loan from your account. Most of the

people are allowed 70% loan from their own accounts. In case of serious need 80% is allowed

to be taken as loan. But with an emergency case and with the help of an authority you would be

awarded 90%.

But it is beneficial for policy holders to take a minimum loan from their account.

EXAMPLE. If you take 70% loan, then 30% will remain in your account and its cash

value will remain take it enforces for more time. If you take 90% loan, then only 10% will

remain in your account and it will cover less time to take policy enforced.

No deduction of Zakat from death claim. While Zakat is charged from both surrender

and maturity claim.

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4.4.5 ALTERATION SECTION.

The alternation section is another important section of PHS. All such policies, which

require any alternation for example. Change of nominee, change of address, change of terms,

change of mode of premium and change of any other thing in the policy directs their

applications to the PHS. Authority after altering the required things in the policy sends their

policy documents to the concerned policy holder.

All these sections of PHS are interring links with other sections and professional staff

with trained officers is busy in providing services to the clients.

4.4.6 SUSPENSE ACCOUNT SECTION.

This section is an important section my giving an application to the manager PHS can

enforce all such policies, which due lapsed. The under writers of the PHS department

scrutinizes the applications and then revive and reinforce lapse policies, there is any

requirement in the policy the premium is placed in suspense. Account and a provisional receipt

is issued to the client. A policy holder service is the heart of state life insurance corporation.

All record of the policies is kept with the PHS department and all legal and officials letters are

written and send by this department.

The code which is use for suspense account is 571.

4.4.7 AGENCY DEPARTMENT

It is an important department of state life insurance Corporation. It keeps the record of

all the field staff in the zonal office, sector offices issues code numbers to field workers and

maintain their all business record. It also deals with licensing authority and all licenses of the

field staff are sending and receiving through this department. This department is controlled by

the zonal head and run through a manager with the help of other supporting staff. It also keeps

the record of promotion of the field workers and other related matters of the field force.

The sale representatives (S.R) play a key role. Consequently upon his selection, the S.R

received some basic training in sale management marketing, and on the job training the S.R

works under the supervision and guidance of sale officer. After two years service as sale

representative he is eligible for promotion, if fulfill other condition necessary for promotion.

4.4.8 PAYMENT SECTION

Through this section the employees of SLIC and the policy holder takes their payments.

The payment is mode in two forms.

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Payment in cash.

Payment in cheques.

4.5 JOB RESPONSIBILITIES.

4.5.1 PROSPECTING DIFFERENT CLIENTS.

Prospecting is a kind of raw material for the insurance company because without this

raw material or stock products will not sustain longer.

4.5.2 STEPS NEED FOR PROSPECTING.

Offer

Contract.

Analysis of problem.

Acceptance (filling of proposal form).

Specific investigation ( if any required )

Closing.

After closing this file is preceded towards policy holder service department. (PHS).

4.5.3 FILLING OF PROPOSAL FORM.

During my internship period I also fill proposal form, actually filing this form requires

lot of techniques. When fill this form we must consider different factors which makes thepolicy of any person. For this we must match the weight of required person for his age if the

weight of any person is more than his age then we must correct it by our own way, if we do not

do so then the process takes long for the person he makes his medical for showing that he is fit

and healthy and then his policy will be started.

4.5.4 TAKING CALLS FOR HELPING OUR CLIENTS.

I also attend the calls and gave different details for making a policy and telling people

how the policy works for making your life better and also how you manage your policy and

how premium you paid per year. We explain different benefits of insurance and especially one

benefit is that if a person started their policy in December then they get one year benefit in

such a way that they submitted their one year premium in this month and considers as the one

year. This is really a great benefit for the new client.

4.5.5 MAKING POLICY ENTRIES.

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In my internship period I also make the entries of transcripts in a register and with these

entries we also mention different requirements for the clients. Such that submitting their annual

premium regularly. If a person did not submit their amount in a year then we mention that this

person not submitted his premium in this particular year.

4.5.6 ACCOUNT SECTION.

In account section I also know about their money matters, as the agents comes regularly

every day and they submitted their premium payments to our boss which they gathered from

their clients. These agents were worked in the organization on the commission bases; they have

no regular monthly income. They money we gather daily we make a record on a paper and

with the signed of our boss then we send one copy to our Zonal office in Islamabad and one

copy we put in our folder or file.

4.5.7 WRITING LETTERS TO OUR CLIENTS.

I personally writes a letter which they further sends to their currently clients when the

years goes ended. The purpose of writing this letter is to remind of our currently clients that

submit their premium for this particular next year.

CHAPTER.5 SWOT & PEST ANALYSIS.

5.1 SWOT ANALYSIS.

5.1.1 STRENGTHS.

5.1.1.1 HIGHLY SKILLED PEOPLE.

SLIC is one of the largest life insurance corporations of Pakistan. It has maximum share

in the market. So it has also the maximum human skills. The highly talented and skilled people

are working and using their bests in their jobs. So it is great strength of SLIC as the human

mind is the most important weapon to compete and to get competitive edge in the market.

5.1.1.2 OLDEST LIFE INSURANCE IN PAKISTAN.

SLIC is one of the oldest life insurance corporations of Pakistan. Hence its customer

base is strengths from this plus point as customers have more confidence in the SLIC. The

additional value services as the privilege for the corporation.

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5.1.1.3 FIELD WORKERS ARE THE BIGGEST PLAYER IN THE

MARKET.

Field workers of SLIC as SR, SO, SM are the main player in the market. They are the

people who represent the image of the corporation.

5.1.1.4 MORE DEPOSIT THEN ANY OTHER INSURANCE COMPANY.

SLIC has the relative competence in having more deposits than the other insurance

company. This is because of the confidence the customer have in the SLIC.

5.1.1.5 EMPLOYEES BENEFITS.

The employers at SLIC are offered reasonable monitory benefit. Normally two bonuses

are given Eid-UL-Fitat & Eid-UL-Azha. This serves as an additional benefit and competency

for the corporation and a source of motivation for the employees.

5.1.1.6 STRICTLY FOLLOWED RULES & REGULATION.

The employees at SLIC are strict followers of rules and regulations. The disciplined

environment at SLIC bolsters its image and also enhances the over all out put of the

organization.

5.1.1.7 PROFESSIONAL COMPETENCE.

The employees at SLIC have a good hold on their descriptions, as they are highly

skilled professionals with back ground in business administration. These professional

competencies enable the employees to understand and perform the function and operation in

better way.

5.1.2 WEAKNESS.

5.1.2.1 POLITICAL INFLUENCE.

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The strong political hold of some parties and government and their dominance is

affecting the corporation in a negative way. They sometime have to provide loan under the

pressure, which leads to uneven and adjusted feeling in the employees.

5.1.2.2 INCOMPETENT FIELD FORCES:

In term of quantity, it is strength but in term of quality it is weakness. Most workers are

not highly educated. They are promoted by fulfilling targets.

5.1.2.3 LACK OF MARKETING EFFORT.

The SLIC does not promote its corporate image, services etc on a competitive way.

Hence lacks far behind in marketing effort. A need for aggressive marketing in there marketing

in now becoming a part of every organization.

5.1.2.4 LACK IN OTHER KINDS OF INSURANCE.

The SLIC only does life insurance. It is a great weakness of SLIC as the world is

changing and there are other insurance companies who are doing other insurance with life

insurance. So in order to compete SLIC should start the General Insurance also as it has also a

good imaged so it can be beneficial for them.

5.1.2.5 FAVORITISM & NEPOTISIM

The promotions and bonuses etc are often powered by seniors' favoritism or depends

upon their wills and decision. This adds to the negative factors, which denominate the

employees thus resulting in affecting their performance negatively.

5.1.2.6 CENTRALIZED DECISION MARKETING:

Managerial decision-making is totally centralized in the branch Offices follow the

instruction and rules & regulations provided by AM. Sometimes decisions is taken by AM is

not strategic and adjustable in the local environment. For prosperity & survival of the

organization, decentralization (to some extent) is necessary.

5.1.2.7 INCREASING RATE OF SURRENDER

Because of economic condition, when the saving of people lower they cant continue

their policy. So they surrender the policy, and this is one of the important weaknesses of SLIC.

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5.1.2.8 TURNOVER OF FIELD FORCE

As field worker are commission based, so turn over in SLIC high because those who

fail to bring business, leave the organization.

5.1.2.9 ECONOMIC CONDITIONS

Economic condition of Pakistan is not so good, due to which people has lass saving, so

when saving will be lass they cant be able start a policy.

5.1.2.10 LESS AWARENESS OF MASS INSURANCE POLICIES.

A large part of population is leaving in rural areas and people of that area is not aware

about life insurance.

5.1.2.11 LACK OF COMPUTERIZED NETWORK..

The SLIC lack the strength of being powered by the network of computers, which have

saved time, energy and would have lessened the mental stress, the employees have currently.

This would add to the strength if it were powered by network of computers.

5.1.2.12 LACK OF MODERN TECHNOLOGY.

The SLIC lacks the modern equipment i.e. note counting machine computers. Even if

there is any equipment they lack to fall in the criteria of being settled the situation such as

upgrade or updated.

5.1.3 OPPORTUNITIES.

5.1.3.1 GROWTH OF FINANCIAL SECTOR IN PAKISTAN.

As financial sector of Pakistan is starting better which will make better the financial

position of people and will increase saving of people. So this is an opportunities for SLIC to

increase their business.

5.1.3.2 DIVERSIFICATION.

As SLIC is providing services in just only in life insurance, it can also start general

insurance, like the insurance of property etc.

5.1.3.3 GREAT SHARE IN THE MARKET.

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SLIC has a great opportunity to create great share in the market. As they were only

doing Life insurance by starting other insurances also they can have a maximum share in the

market.

5.1.3.4 LOW PREMIUM RATE.

SLIC have a low premium rate as the customer is younger the premium rate will much

low , SLIC also give opportunity to female in 2 years rebate and because of this their premium

rate are very much low.

5.1.3.5 INNOVATION.

SLIC also bring so many innovations in their present product, like they decrease the

maturity duration of policy or can decrease sum assured of policy etc

5.1.4 THREATS.

5.1.4.1 NEW COMPETITORS.

With the passage of time so many organization are coming to insurance business, so

there will be tuff competition for SLIC to face in future.

5.1.4.2 CUSTOMERS HAVE MORE OPPORTUNITIES IN OTHER

GENERAL INSURANCE.

The other insurance companies having more attractive opportunities as they are offering

superior services and more benefits to customers. So customers can switch on toward those

companies.

5.1.4.3 VAST MARKET.

Vast market is also a great challenge for SLIC. Now the environment is being changed

new and new insurance companies are coming and also capturing the market share. As the

market is vast and there is no restriction on new companies. It is threat for SLIC because these

new companies can reduce the business.

5.1.4.4 RECESSION IN ECONOMY.

As Pakistan economic condition is not so stable so recession in economy can affect its

performance by increasing the surrender rate of policy holder.

5.1.4.5 EMERGENCE OF NEW COMPETITORS WITH TECHNOLOGY.

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The SLIC is facing threats with the emergence of new competitors especially in terms

of foreign Insurance Companies. These foreign Insurance Companies are equips with heavy

financial power with excellent and innovative ways of promoting and performance their

services. The SLIC has to take initiative in this regard or will find itself far back in

competition.

5.2 PEST ANALYSIS.

5.2.1 POLITICAL FACTORS.

The political environment of Punjab is quite stable since the last years. Government.

Thought some factors are always trying to pollute the social and political environment of this

province, Government has taken very positive initiatives in this context and people fell no

hesitance to invest their money in insurance packages. As the nature reveals, insurance has

always been a social and ethical code of business. So State Life Insurance Corporation has a

favorable political environment for investment and business activities. On the other hand

government policies that regulate the overall business have no harm to their activities.

5.2.2 ECONOMICAL FACTORS.

The economical environment too is almost in the favor of businesses prevailing in the

province. Same is the case with State Life Insurance Corporation, because it is along term high

return project. The employment rate is at an increasing trend because most of the people are

coming towards their own businesses which lead to employment generation and indirect

technology base environment. Than these factors as a whole contribute to a higher per capita

income. Due to positive and friendly economic factors their vast set-up and business

regulations people feel free to invest their savings for a long-term and safe return.

5.2.3 SOCIAL CULTURAL FACTORS.

Socio cultural factors play an important role in the smooth running of business. As a

fact the dominant religion of Punjab is a peaceful religion Islam. People of this provincehave great devotion towards the principles and teaching of Islam. Due to these reasons a

specific group of people are against the Insurance policies, which affect the business of SLIC

to a greater extent. In such circumstances word of mouth and the social set-up matter a lot.

But at the same time the people of Punjab are also not in favor of foreign products and foreign

organizations, which is a positive sign for State Life Insurance Corporation of Pakistan.

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5.2.4 TECHNOLOGICAL FACTORS.

In terms of technological advancement state life insurance corporation is behind its

competitors in the race of insurance business. Few insurance corporations coming to this field

with a new and modern technology has got a reasonable market share in a short span of life.

But now State Life Insurance Corporation is launching online business. With this facility

people can get every type of information about SLIC. Their packages, rates and also can apply

for online policies. This service will provide a new ways and segments, where State Life

Insurance Corporation can compete on strong grounds.

CHAPTER.6 CHALLENGES & RECOMMENDATION.

6.1 CHALLENGES.

6.1.1 COMPETITORS:

The existence of local and government insures such as

American Life Insurance Co. (Pakistan) Ltd

Commercial Union Life Assurance Co. (Pakistan) Ltd

EFU Life Assurance Limited.

The Metropolitan Life Assurance Co. of Pakistan Ltd.

National Insurance Company Limited.

Adamjee Insurance Co. Ltd.

Continental Insurance Co. Ltd

6.1.2 POLITCAL INSTABILITY:

Political instability looses the confidence of the policyholders. Further rules and

regulations of government are subject to change creating threat to insurance business.

6.1.3 DEPENDENT ON FOREIGN RE-INSURERS.

Insurance companies in Pakistan are heavily dependent on foreign re-insurers to

minimize their risks in case of any eventuality. In the post-September-11 world this heavy

dependence, made necessary due primarily to the failure to establish a re-insurance company in

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the country, is not only taking a heavy toll on the trade and industry in terms of increased cost

of shipping but has also eroded the sense of security as foreign insurers are no more including

Terrorism cover, which used to be a part and parcel of the re-insurance treaties previously.

6.1.4 NEED OF NEW MACHINERY.

State life should focus on bringing new technology for their organization so that they

can make their performance better.

6.2 LEARNINGS.

6.2.1 INTERACTION WITH PEOPLE.

During my internship period the most learning thing for me is how to interact with your

customer and also with other employees in the organization.

6.2.2 CONFIDENCE GAINED.

In my internship period I also gained lot of confidence and I have potential to fulfill the

different tasks.

6.2.3 HANDLING OFFICE DATA AND OTHER RECORDS.

I also manage different files and records during my internship period.

6.2.4 TECHNICAL SKILLS.

As the technical skills are that I used computer application and with the work with

secretary, I attended different calls and know the customers problems and know how to solve

these problems.

6.3 RECOMMENDATIONS

The state life Insurance Corporation has a monopoly in the life insurance business. The

biggest competitor is National Savings. But as whole the market is monopolized by SLIC and

market share of SLIC is about 80%.

For the promotion development of the business of the corporation the following

suggestions and recommendation is given:

As the union in SLIC is very strong, so many time it interfere in the working of SLIC

specially in the recruiting low level employees from grade 1 to 8. Because employees of these

grade are appointed according to wishes of union. This often leads to recruitment of

incompetent people, which may affect the efficiency of SLIC. So the role union should be

minimized.

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Recruitment problem also face by SLIC at managers level. For the manager level posts

relevant qualified people should be appointed e.g. MBAs will be suitable for such type of job,

but they also appointed lawyer which is totally irrelevant for the job they perform.

There is also found the lack of proper and channelized communication among the

different deportment of SLIC. The communication should be properly channelized and should

not be so much complicated.

As it is accepted that field workers are very essential factor in bringing business. So

turn over of sale force is other sever problem of SLIC. To reduce turn over and retain

experience and competent field workers their commission rate should be increase, in order to

motivate them for better performance.

SLIC also adopted a procedure for promotion of their employees in which includes

their performance and passing of FLMI test. This is conducted by an American institute, it

consists of 10 papers, and cost of each paper is from Rs. 5000 to 6000. So this is very

expensive test. And this may affect a person who is competent but cant offer these expenses.

So SLIC should reduce this cost or should help the competent employees in monitory terms.

As the field workers are commission based so they are not considered the permanent

employees of the organization, there for they have no role in policy making while they face the

real problem on ground, so they must include members of field force when they making policy

for them.

So many policy holders are facing problems and depositing their premium, especially

people of rural area. Because most of the cash counter are situated in district cities which are

far away from the side area of district. So SLIC should open cash counter in side areas also,

this will make the people to deposit their premium easily.

Surrender of policy means the end of policy. So many people surrender their policy

because of less saving they cant deposit their premium. So to stop the surrender of policy the

SLIC should increase the time period for revival of policy. This will give extra time to policy

holder to continue their policy if they want.

Lapses in policies should also be reduce, And this can be done by continuous

motivating of policyholder to deposit their premium regularly. This will also help them to

attain persistency.

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State life insurance has more than 52 building through out the country. And most of the

position of the building has given on rent. But when there is recession in economy most of the

companies leave the offices in state life building because of its high rent, which leads to

reduction in net income. So the state life should facilitate the rent of offices according

economic condition.

CHAPTER.7 BIBLOGRAPHY.

SLIC web site: www.statelife.com.pk

Annual Report 2008, State Life Insurance Corporation of Pakistan.

Formal meeting with area Manager of Islamabad Zone.

Formal meeting with Sales Officer (Jabar) Islamabad.

Kotler.Philip (2006) Principles of Marketing (11th edition)

Bovee.L.Courtland (2002) International Edition Management

Bovee.L Courtland (1994) Advertising Excellence)

Keller.Lane.Kevin (1997) Strategic Brand Management

www.google.com

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