Jaipuria Institute of Management,

Vineet Khand, Gomti Nagar

Lucknow – 226 010

Academic Year 2020-21

Batch 2020-22
Trimester 2
Programme PGDM-FS
(PGDM / PGDM-FS / PGDM-RM)
Name of Course MHR
Section D
Name of Faculty Prof. Pallavi Srivastava

Nature of Submission Assignment

(Assignment / Project Report)
Topic of Assignment / Project HR Practices in Insurance Industry

Deadline for Submission 25-12-2020

Group/ Learning Team Number 5
Maximum Marks Allotted

Contribution of Group/LT members in the Assignment/Project

Sl. Name & Enrollment Contribution Signature

No. Number of Student

1 Yash Govil JL20FS050

2 Aditi Sinha JL20FS03
3 Harshita Tripathi J20FS015
4 Aishwarya Gupta JL20FS04
5 Akhand Pratap Singh

JL20FS005
6 Shashank Sankritya

JL20FS041

Date of receiving at PMC: Signature of PMC Staff:

Penalty [Marks to be deducted (if any)]:
HR Practices in Insurance
Industry.

1|Page
 OVERVIEW
The insurance is mainly a social device practiced by civilized society for minimize the incidence of loss of
income among families by unexpected contingencies. Earlier studies on life insurance primarily focused
mainly on LIC, it was only after changes in this field that some studies covering private players have taken
place.
Insurance sector has 57 insurance companies, 24 of which are life insurance companies, while 33 are non-
life insurance companies. Life Insurance Corporation (LIC) is the only public sector organization among
the life insurers. The non-life insurance category has six public sector insurers.
The insurance Industry has the potential to produce a large number of job opportunities as the people in the
insurance industry are segmented into Sales, non-sales and senior board/management. Also, the training
programmes are designed accordingly.
The people now have awareness about the insurance. Many people consider insurance essential which
should be ready in case of any other unforeseen situation in the future. Though Corona Raksha and Corona
kavach policies have already been adopted by several firms, others are working on developing Corona-
related policies. Corona special insurance plans will soon be launched by more insurance providers.
In order to ensure the smooth transition of the industry to the post-COVID world, insurance companies are
taking the requisite steps. The insurance industry is expected to undergo a significant transition from front
offices encouraging their clients to connect digitally to financially support their brokers in these difficult
times by supplying them with advance commissions.
The major disruption will be because of the digitization that has already taken place globally in the
insurance sector, but the transformation phase has been exacerbated by the arrival of the COVID crisis.
This will basically mean that the industry's digital clients can only expect better options and easier
distribution processes in the coming days.
The Government of India has taken number of initiatives to boost the insurance industry. The Government
has approved to raise the foreign Direct Investment (FDI) in the insurance company from 26 percent to 49
percent which would help attract investment in the sector.
With many changes in the regulatory system, the future looks bright for the life insurance sector, which
would lead to more changes in the way the industry performs its business and engages with its clients. For
the next three to five years, the country's life insurance industry is forecast to grow by 14-15 percent
annually.

Five major players in the insurance sector:

1. Life corporation of India (LIC)
2. MAX Life insurance Company
3. HDFC Standard life
4. ICICI prudential Life insurance
5. TATA AIG General insurance Company Limited

2|Page
3|Page
 Covid-19: Challenges Faced by India’s insurance industry:

Impact on individual insurance sectors

Even after Covid-19, the future of the insurance sector is not so bad, as compared to the other
sectors. Given below is the analysis of the different sectors of insurance:

1. General Insurance

General Insurance basically depends on the performances of industries and individual

businesses. Because of the lockdown the industries have suffered and as a result there has been a
negative impact on the sector.
Due to low level of moment and other activities there is a decline in personal accident front and there is
also a decline in renewal of policies.

2. Health Insurance

In India there is not much demand for Health Insurance. But because of COVID-19 the demand
is expected to increase comparatively.
With rising number of cases, IRDAI has made it mandatory for all the general and health
insurers to start offering “Corona Kavach – an indemnity-based health plan and Corona Rakshak
– a fixed benefit health insurance” to their customers. These policies will cover the expenses of
COVID-19 patients. The insurers are not really at a loss right now as the planed surgeries are not
happening at the moment. Because of the fear of the pandemic, people have started buying health
insurance. The insurance inquiries have also increased considerably.

3. Life Insurance:

Since, the pandemic people are eager to increase their cover. As a result, there is a boost in
demand, especially for pure life insurances. Apart from all this the demand for investment linked
products can also drop as the confidence in stock market has reduced to a large extent.

4. Automobile Insurance:

The automobile sector, was already witnessing a slowdown and COVID-19 made it worse. With
companies mostly adopting the “work-from-home policy”, there has been a drastic reduction in
the number of vehicles on roads which has resulted in decrease in the number of kilometres
driven by people. Thus, insurance customers are opting for discounted policies which are
cheaper for them.

4|Page
Other Major Challenges:
 A 100% digitization resulting in minimized interaction with customers.
 The sector is facing Operational challenges because they have moved to remote working due to
COVID-19.
 Challenges because of brokers and agents.
 Over burden of work due to reduced workforce.
 Those who don’t have a good technology face a risk of losing their customers as their
competitors are shifting towards digital working.
 Difficult to deal with complex or high value claims as evaluation has become difficult due to
minimal physical contact. As a result, fraud has increased.
 Increased social responsibility.
 Scenario planning becomes more difficult because of challenges like- IT failure, removal of
staff, further increase in demand and second waves.

HIRING
India is one of the most affected country due to COVID-19. It shook the nation’s economy and adversely
affected each and every sector of the country. Particularly talking about the hiring scenario in different
sectors, the from some of the newspaper sources we came to know that the country witnessed an adverse
effect in the short run with around 60% to 65% interview getting delayed.
According to experts, the Insurance sector being a kind off sector where frontline hiring takes place have
witnessed a huge delay in interviews that eventually affected the hiring of workforce in the insurance
companies of India in COVID.

During an interaction with H.R of LIC, we came to know that since the corona breakout took place in 2020,
LIC have not conducted any entrance exam for selection process and they have not employed any fresh
candidates rather they are interviewing or have interviewed only the candidates who appeared and cracked
the 2019 entrance exam.
After some more research and from some sources we also came to know that the lay off in the insurance
sector was not on very huge margin, there was not very significant layoffs in insurance sector as compared
to other sectors.

Training and Development

Training and development are an integral part of the human resource management which emphasis on the
development of skills, improvement of existing skills, gaining more knowledge, information, which helps
in increasing the performance and productivity of the company.

5|Page
Training and development were one of the biggest challenges during the COVID-19 but the insurance
industry succeeded in accomplishing the objective of providing training and development to their
employees by quickly adapting to the the crucial situation.
Following are the key points where training method of the employees of major insurance company focused
and worked upon –

1. Training on use of technology – the insurance industry has focused on the digital
infrastructure. MAX Life L.T.D has provided the digital infrastructure such as internet connectivity,
virtual meeting tools like zoom. Partnership with the key vendors to acquire licence, application
support and network support. The employees had been trained on the technical aspect of the
software. The company provide laptops, service desk and other essential to provide the smooth
functioning of operations.
2. Training on digital selling – During the lock down, the insurance companies like Bajaj
Allianz Life insurance provided training sessions to sales executive on how to conduct video calls,
phone calling, using new communication platform like webinars for developing skills. Companies
like HDFC Life has provided training session on “Digital Marketing” on how to pitch the customers
through social media platforms, launching ad campaign, analysing traffic, and targeting them to
generate leads.
3. Training on soft skills and communication – the company has provided soft skills training
by appointing a trainer. The training programmes are organized usually once in a month or
sometimes weekly. The trainer provides the training using digital platform and webinars. The
technique, which is being used are role play, lecture method, simulation exercise, body language,
gestures etc.
4. Other methods used in training- There are some other techniques which are used for used
are-
 The induction training for freshly recruited employees is provided through video conferencing
and audio conferencing which started with formal introduction of the organisation succeeded by
orientation program and duties with responsibilities.
 The companies had provided the motivational training at all levels of employees using webinar
This helped them to get their confidence back and keep their morale high.
 The training is mostly provided to enhance knowledge related to the technical aspect, digital
tools, social skills and communication skills.
 Company like Bajaj Allianz Life has developed training modules and schedules to help them
managing their work and personal lives. Following it the company re-trained around 80000
insurance consultants to connect and serve the customers digitally through virtual tools.

6|Page
 Performance Management
For performance measurement the insurance sector considers the following points:

 Revenue per Policy Holder: It is a performance indicator that reflects the revenue earned by
the insurance company, per policy holder.
 Average cost per claim: It basically measures how the concerned organization pays for the
claim filed by its customers. Through this method the organizations access the risk associated with
their different policies and try to adjust it accordingly.
 Customer Satisfaction: It is a very important indicator for performance management, as the
sole duty of every organization is to serve its customers.
 Average number of policies per agent: If the agents have good number of policies it means
that the organization is doing good.
 Return on investment and other activities : If the organization is getting good returns then
it’s a good indicator.
 Competitor’s strategies: In order to manage your own performance any organization needs to
analyze its competitor’s strategy.
 Employees Morale: If the morale of the employees is low it means that the organization is
doing something wrong and needs to take corrective actions.
 Dealing with drop-outs: If people are dropping out of the insurance contract then it reflects
that the performance is not up to the mark.
 Speed in processing: For the processing the proposals the insurance companies have a
mechanism. If the speed of the process is good then it means that the mechanism is effective.
 Employee and agent training: In order to make the performance better, it is a must that the
employees and agents have a proper training.

Compensation Management
Compensation management is one of the basic tools in HR practices and most important tool to motivate,
attract and reward the individuals to achieve the organisational goals. This management should be done on
the basis of various factors of individuals like their skills, competencies, experience and on the basis of
seniority. Market and competitor’s factors also matter on the management of compensation.

HDFC Life Insurance

Two types of management structure which is Fixed pay and Variable pay.
In Fixed pay all typical components like Basic salary, allowances, post-retirement benefits and all types of
perquisites would be determined. Except all only Perquisite’s is determined or extended on the nature of
working of an individual and all this will be approved by Nomination and Remuneration Committee.
Variable pay consists of bonuses and incentives means in HDFC bank they determined that no one will get
more than 70% variable pay of the Fixed pay and there will be balance maintained between the variable
and fixed pay.
Time to time HDFC bank will revise the compensation policy and take decisions according to that.

7|Page
References
https://v1.hdfcbank.com/assets/pdf/Compensation-Policy.pdf

ICICI Prudential Life Insurance

ICICI Prudential life insurance company takes various steps to retain the employees and motivate them but
they follow totally different policies if we compared with HDFC life insurance company. They (ICICI)
follow 6 steps in their compensation management.

 Annual guaranteed pay (AGP) – in AGP all type of pays like Basic salaries and all type of
allowances.
 Variable pay – this is totally depending on the capacity to pay of the company means totally
depend on the individuals and employees who meet the target, get incentives and promotions. We
also said this as performance linked reward.
 Long term pays – This is done to retain and to motivate the employees to take actively part in
the meetings with full of enthusiasm. In this various pay like employee stock option included etc.
 Non-cash benefits – Like Hospitalisation policies, company car facilities and insurances of
family and individual.
 Post-retirement benefits
 Guaranteed bonus - this is not compulsory in the organisation up to when they hire or appoint
new staff from the market.
Process will be reviewed annually and after that various other benefits like increments, bonuses, pay cuts
and promotions would be done. Increments would be done on the basis of individual employee
performance annually same should be considered for the Bonuses and long term pay.

References
https://www.iciciprulife.com/content/dam/icicipru/about-
us/corporate_policies/CompensationBenefitsPolicyFinal.pdf

Employee Relations- Adapting the new normal

The COVID-19 outbreak has initiated a massive and seamless insurance services like health insurance, life
insurance etc. but have also caught between the contradictory needs i.e. movement restriction of the
agents and the limited workforce of the organization.
Go Digit is taking initiative for the organization to ensure smooth working of the firms through product
trainings which is easily accessible from home. The HR Teams keeps in touch with the employee on
regular basis, through e-meetings while keeping record of the work. HR team is also taking care of the
mental wellness of the employees.

8|Page
Productivity of the employees have also increased, and their targets were tripled on an average as per the
industry analysis.
Online/ Virtual employee engagement programs are adopted by the firms called “Virtual Happy hour” to
enhance the morale of the employees in this unprecedent times to establish relations between colleagues
and the team members such as having online games and video chats (informal as well as formal).
The WFH culture has been taken to new heights due to the Covid-19 and enhanced customer satisfaction
too. People have also coming up with creative ideas and innovative solutions to the complex problems
despite the complexities and fear of the pandemic which stimulated anxiety and depression among the
employees. There are some potential problem areas where conflict may arise regarding work and personal
life which needs to be diagnosed for feasible solutions.
Those organizations who have retained their employees have gained the trust of their employees and
hence enhanced their productivity by 100% adopting to flexible schedules which helped the working
couples as well the people with no domestic help in the COVID times to maintain a balance between work
and home.

9|Page