INTRODUCTION

Insurance
Insurance means that the Probable loss occurring in future can be so shared that the overall impacted of total loss to any individual or section of the society is mitigated. Insurance can be of life for the compensation in case of normal or accidental death or of property like car , bus ship , airplane , etc . in case of loss caused by fire , floods , earth quakes etc . insurance provides compensation for the loss to a maximum extent . The term insurance is some times also called assurance. Both terms are defined in the same way, as It is a social device providing financial compensation for a fact ofmisfortune the payment being made from accumulated contribution of all participants in the scheme.The other definition may be Insurance is financial arrangement which distributes the cost of unexpected losses. Technically, above-mentioned definition can be explained as Insurance is a contract in which a person agrees to pay some cost for the compensation of any misfortune in future. Insurance can be divided into two basic categories; life and non-life, which are called general insurance.

Hi s t o r y o f I n s u r a n c e :
The need of sharing losses caused particularly by sea perils was left several Hundred - year ago . The merchant ships remaining away for months with valuable Cargo carried with them the hope of marketing profits upon their safer turn . The Life insurance provides financial protection to the dependents of the breadwinner while non-life insurance covers material possessed and used by a person for his personal comfort and well being.

CORPORATE INFORMATION
Reference: Annual report 2008. 1. BOARD OF DIRECTORS Chairman Mr.Kamal Afsar. Director Mr. Qamar Zaman Chaudary. Director Mrs. Spenta kandawalla. Director Mr. Aslam faruqe. Director Mr. Amin Qasim Dada. Director Mr. Rasheed Y. Chinoy. Director Mr. Syed A. Wahab Mehdi. Director Mr. Syed Hur Riahi Gardezi. 2. PRINCIPAL OFFICE State Life Building no.9, Dr. Ziauddin Ahmed Road, Karachi-75530. E Mails:edpgs@statelife.com.pk. 3. REGIONAL OFFICES

Southern Region Main Shahrah-e-Faisal, Karachi. Northen Region Blue Area, Islamabad. Multan Region Tariq Road, Multan. Central Region Davis Road, Lahore. 4. ZONAL OFFICES a) Karachi (South) b) Karachi (Central) c) Karachi (Eastern) d) Hyderabad e) Mirpurkhas f) Sukkur g) Larkana h) Quetta i) Lahore (Central) j) Lahore (Western) k) Faislabad l) Sargodha m) Multan n) Vehari o) Sahiwal p) Rahim Yar Khan q) Dera Ghazi Khan r) Bahwalpur s) Rawalpindi t) Islamabad u) Gujranwala v) Sialkot w) Peshawer x) Swat y) Abbotabad z) Kohat
MANAGEMENT HIERARCHY Chairman Executive Director Executive Director Executive Director Gen. Manager Dept. GM Executive Director Asst. GM Manager Field Force Management

Dept. M Area Manager Asst. M Exec. Off Sale Manager Superintendent Off. Asst. Sale Officer Record Sorter Insurance Sale Representative Lift Operator Qasid

DEPARTMENTS IN STATE LIFE INSURANCE CORPORATION

State Life Insurance Corporation (SLIC) has divided its whole setup into twelve departments. The organization setup is same in Zonal Offices, Regional Offices and Principles Office. All the Regional and Zonal departments are directed from the Principle Office. The twelve Departments are currently performing services in SLIC. There are two Departments which are working only in Principle Office at Karachi. The function of each Department that is common in all zonal and Regional Offices are given below:

1. New Business Department 2. Policy Holder Service 3. Budget and Accounts Department 4. Personnel and General Services Department 5. Agency Department 6. Internal Audit Department 7. Computer Department 8. Field Manpower Development Department 9. Group Insurance and Pension Department 10. Commission Department. 1. NEW BUSINESS DEPARTMENT
The business of SLIC is initiated through New Business Department (NBD).When Insurance Sales Rep sells policy to any client then this department handles all the document procedures. The precise working of the department is as follows

1. Proposal Number Section 2. Underwriting Section 3. Premium Calculation Section 4. Policy Issue Section

1. PROPOSAL NUMBER
In order to fulfill the recognition of the Insurance Policy, NBD allocates a number to each Insurance Policy for future references. New business department also verifies whether the client is a new customer and a past customer.

2. UNDERWRITTING
Underwriting is the process through which the underwriter assesses the risk associated with the Insurance proposal. Underwriter verifies the personal information provided in the proposal form. If he feels that client should have a medical checkup than SLIC has its own panel of doctors to provide medical assistance.

3. PREMIUM CALCULATION
After underwriting, the premium of sum assured is calculated in accordance with the rate book provided by the SLIC.

4. POLICY ISSUE SECTION

After premium calculation the insurance and revenue stamps are embossed on the policy bond and the policy document is sent to Client. One copy of policy document is sent to Policyholder Service Department for record purposes. New Business Department considers the risk associated with the proposal and estimates the premium for the client through a formal agreement between SLIC and the client.

2. POLICY HOLDER SERVICE DEPARTMENT

The Policy Holder Department deals with the services provided by the corporation to his Policyholders. The Department is divided into following cells to provide better facilities to the Policyholder.

1. LOAN 2. SURRENDER 3. MATURITY 4.DEATH CLAIM 5. REVIVAL 6. SERVIVAL 7. ALTERATION a) LOAN

This section given a loan to policy holders up to 80% of surrender value. If written request from policy holder then up to 90% of surrender value. Compound interest are charged on loan payment a @ 10 p.a.

DOCUMENTS FOR LOAN APPLICATION.

1.Loan application. 2. CNIC copy. 2. Policy bond 3. Last receipt of premium. 4. Schedule form / stamp paper. 5. Bank account are attested from bank manager. 6. All the above documents are attested from gazetted officer.

b) SURRENDER
This section performs a function of closing the policy if a policy holder wants. First of all we asked the reason for surrender the policy and then motivate the policy holder. 1. Application. 2. NIC copy. 3. Policy bond. 4. Bank account are attested from bank manager. 5. Discharged voucher. 6. Issuing a receiving receipt. 7. Policy holder documents that are received are attached with policyholder file. 8 Collection sheet & surrender value sheet are attached with file. 9 Post-audit 10 Cheque preparation. 11. Final payment.

c) MATURITY SECTION
This section provides a services to the policy holder after maturing the policy. Policy are matured after one year of last payment . At maturity date net payable amount are paid to the policy holder. Reminder are sent to policy holder after 15 days of maturing the policy. At maturity the following documents are required from the policy holder. 1.Policy bond. 2 .NIC attested copy. 3 .Payment voucher. 4. Pre- audit. 5. Preparation cheque. 6. Final payment.

d) DEATH CLAIM
Claim of policy holder are paid after the death of policy holder to the nominee.Process of death claim are as under: 1. Application from nominee. 2. Death certificates from Union Council. 3. CNIC Copy (both policy holder & nominee). 4 .Claim form. 5. Claim papers. 6. Medical certificates. 7. Identity certificates 8. Employee certificates. 9. Reserves for claim 10. Investigation. 11. Voucher preparation. 12. Post audit. 13. Cheque preparation. 134.Cheque delivery.

e) SERVIVAL BENIFITS SECTION

Survival benefit are allowed only to 05 table / term 15,18,21.This policy is called three payment plan. The policy holder has the right to get 25% of sum assured at the end of 1/3 term, 25% at 2/3 of the term and 50 % at the maturity date these installments are calls survival benefits.

f) REVIVAL
Revival section provides a function of renew a policy which premim are not paid for one or more year after due premium. There are two type of revival.

1. Ordinary revival. 2. Special revival. a. ORDINARY REVIVAL.

If a policy holder fails to pay a premium within 30 days of the second year Premium, the policy is laps.

b. SPECIAL REVIVAL

If a policy holder does not paid a premium of more than 2 years.

REDUCTION OF LATE FEES

Rs.1---2000 = 90 days waves + 50% of remaining amount. 2001----4000 = 90 days waves + Rs.1000 are also waves in remaining amount. 4001---- above = 90 days waves + 25%waves of remaining amount.

g. ALTERATION
Alteration section provides a service to the policy holder for alteration in policy bonds. for example, changing in the name, policy table, policy term option ,CNIC card no. or address are changed. Then application for alteration are sent to alteration section.

3. BUDGET and ACCOUNT DEPARTMENT

This Department maintains the records of all the cash transactions. It prepares payroll for the regular employees and disburses the amount. It also takes care of the fringe benefits such as medical facilities provided to the office staff. Commission that is paid to the Sales Representatives, Sales Office and Sales Managers are also calculated and paid through tis dpartment.To keep the corporation on financial track Balance sheets and Income Statement also prepared on annually, monthly and weekly basis. The Principal office sends Annual Budget to the department and the department is responsible for proper utilization of cash disbursements. The department also send budget forecast for new budget proposal. Payment on behalf of the other zones and preparation of bank reconciliation statements are also function of this department.

4. PERSONNEL and GENERAL SERVICES DEPARTMENT

Personnel & General Services Department provide a services to the front line department i.e. Selection, Recruitment, Termination, Leave Records, Medical, Utilities Bills, Capital and Printing & Stationary and similar other General Services. Personnel Leave Record. Printing & Stationary. Capital Assets. Office Rent. Utilities Bill. Dispatch. Medical. Imprest system

1. Personnel
All the Employees matters such as appointment, promotion, Demotion, Transfer and allowances are dealt by personnel section. For the appointment of the staff and advertisement is initiated in the newspaper. Zonal Head is competent authority for this appointment. The appointment of officers is done by principal office (P.O) Karachi. For promotion of the employee, their Arcs are necessary at the end of each year. Each year employees are promoted on the basis of criteria and instruction set by (P.O)Karachi.

2 Printing & Stationary Section:

This Section maintained the records of printing & Stationary such as papers, file covers, Envelope, printed letter, pencils, forms, calculators, and Dustbin etc.

Procedure of Pre-Qualification: Advertisement is at least 2 newspapers. Specifications are mentioned in advertisement. Received applications. Scrutinizing (Checking the Sight, performance etc of Applicants.) Approved for Panel by the Zonal Procurement committee (ZPC). Call the Quotations. Lower price Items are approved. Demand for casting and Performa are sent to ZPC. Approved and given order. Received Supply. Checking it that is according to our agreement. Bills are received and sent to audit department. Audit the bills and approved. Budget and Accounts Department. Paid the bill by cheque.

3.Issuing Procedures:
Concerned Department fills and sends a requisition slip signed by the head of department. Scrutinized the needs and approved. Items are issued. Records on Register in the head of specific department.

4 Capital Assets Section:

This section is responsible for purchase, sales and maintenance of Furniture and fixture, equipment ,vehicles ,computer & printers. Cost of Items is equal to or greater than Rs.500 is deal as Capital Assets Request of Capital Asset. Issuing a ZPC note for approval. Collect the Quotation. Place a purchase order to lowest quotation. Developer of Assets to user Department. Asset Receiving from User Department. Bills are received. Payment Voucher and pre-audit. Cheque are sent by the B&AD.

5.Depreciation:
Straight line depreciation method are follow. Assets are depreciated @ 10% P.A.

Junk
All the obsolute items are soled and getting the approval by ZPC.

Office Rent
This section paid a rent of sector and area offices up to the limit allowed.Area office devided into 3 Categories according to performance.Offices Limit Contract Period Sector office Rs.3000 per month One & three YearsArea Office Category A=2000 pm Category B=1500 pm Category C=1000 pm One year

3 Utilities Bills 1. Sui Gas: There is no limit of bill. Bills of each month are paid. 2. Electric Power: Only Sector office bills are paid limitRs.3000 per month. 3. Telephone a) Sector Office b) Regional Office
Limit of each department are fixed if bills are increased from fix limit then extra are debited to salary.

4.ispatch Section
Dispatch Section perform a function of submit a letter, cheques and policy documents and reminders to policy holders. Letter and massages to other zone or sector office. Urgent letters are sent through Registry or Courier. Ordianary / Routine letters are posted through Stamps.

5.Franking Machines
This machine is used to punch the stamps on letters. Stamps are fended in Franking Machines by general post office usually for Rs.50,000. Every derelicts are sent to GPO about stamps & Registry.

1.Medical Section
1) Medical Consultation. 2) Hospitalization Expense.

1) Medical Consultation. Staff Members (GRADE 01 to 08)

Married person ---- limit Rs.4000 Per Annum. Unmarried Person ---- limit Rs.2000 Per Annum.

Officers (09 above)

No limit. Specialist & tested. Medicines are also free.

Medical Centers & Labs on Panel

Fatima Medical Center. Medicare Center. Ghorry Lab. Shahabad Lab. Contract durations is 2 year and at least 2 medical center and labs on panel.

a) Hospitalization Expense (Staff and Officer)

Hospitalization of dependent are allowed by SLIC

Application are submit to ZMC. ZMC issued a reference letter valid upto 15 days. Billing & prepration of Payment voucher. Pre Audit and Budgeting. Cheque Delivery at the end of month.

Accounting Treatment
Records of each staff officers are maintained on seprate ledger. Medical Expenses are sum every month and list are submited to P.O Karachi.

2.Imprest Section
Cash are imprest for daily General Expense that are least than Rs.500. Imprest Cash limit = Rs.5000 Leave records of all the departments of state life are maintained in the leave record section (P&GS). Casual Leave = 18 days per Annum Earned Leave = 36 days per Annum Monthly Leave = 90 days Per Annum for 3 babies. Recreation Attendance = 216 days Per Annum then 24 days payment and 12 days leave.

3.Leave Encashment
Remaining leaves are cash at the end of the year.

4.Habitual Late Comer

Three days continuously late.

5.Leave Position
Leave position Performa are submit to each employee at the end of the year about his leave position.

5. AGENCY DEPARTMENT
Services provided by the SLIC are intangible and are therefore are not acquired at the counter by the people who need it, so it must be sold to them by the persuasive method. In order to maintain the record of the field force this department was established. Here are some basic operations of this Department. This department is involved in the recruitment, promotion, Selection and termination of the field force. The Principle office Karachi controls this department. The working of this Department starts with the recruitment of the field force and to keep all the

records of all their sales force and then issue them the licenses. The department motivates the sales force by promotion based on their sales targets. Similarly, this department decides to terminate the sales person if he or she does not abide the rules and regulations of the company or indulge him self in any sort of misconduct. Promotion criteria depend upon achieving the given target for a job title and the persistency rate. The field force is also required to undergo training programs conducting by the SLIC. The department also disseminates important field related information to the sales force. The department maintains a database of field force in order to maintain and manage the daily matters. This department is concerned with field workers. This department is engaged with recruitment of SRs , making license of SRs, promotion, termination and medical facility for field force and arrangement of different contests.

APPOINTMENT AS ISR.
The ISR is appointed by SO/SM. The requirements & conditions for the appointment of ISR is as follows. 1. Age must be 18 years. 2. Minimum qualification is required metric. 3. Must have at least two proposor. 5.ust be resident of Pakistan. 6.nnual quota for ISR is Rs.50, 000.

PROMOTION CRITERIA FOR FIELD FORCE FROM ISR TO SO

1.ust have secured minimum Rs.200,000/- in two calendar years but first year premium should not be less than Rs.50,000/2.st have at least 20 policies in force of different lives. 3.ust have achieved a minimum second year persistency of 72% in the immediate proceeding year. 4.wo year working as ISR. 5.SR-BTC must be passed.

FROM SO TO SM
1.Must have secured minimum Rs.400,000/- in two calendar years but first year premium should not be less than Rs.200,000/2.Must have at least 80 policies enforce of different lives. 3.Must have achieved a minimum second year persistency of 72% in the immediate proceeding year. 4.Two year working as SO.

5.SO-BTC must be passed. 6.Must have minimum 4 productive ISR.

FROM SM TO AM
1 First year premium should not be less than Rs.400,000/2 Premium in three years period must not be less than 45,00,000/-. 3 Last year premium must not be less than Rs.25,00,000/-. 4 Must have at least 20 SR whose business is not less than Rs.20,00/each. 5 Must have working at least for 3 years as SM. 6 Must have minimum 2 productive S0.

TERMINATION
Any agent of SLIC , who behave negatively, violates the rules 7 regulation or indulge fraud or mal-practice , can be terminated by the ZONAL HEAD. Any agent who fails to meet the annual quota of FYP is demoted to immediate lower rank of the field force.

MOTIVATE STRATEGIES FOR FIELD FORCE

Prizes and awards are given to field force who achieved the highest FYP at any time announced by SLIC.

6. INTERNAL AUDIT DEPARTMENT

Audit is the official examination of the accounts of the organization to see whether the reported income is presented in real terms. Actually audit system removes the element of any type of cheating of fraud and taxes levied on actual income, all the unfair means of benefit are supposed to eliminate by the system. SLIC is having internal as well as external audit. So, in the same manner this department is some how like account section but instead of maintaining accounts, its work is just to check the work. The department provides assistance to external audit. It is compulsory for all registered companies to check their accounts by any of audit firm every year spent. No audit firm can audit any company for more than three years. As well as the working of this department is concerned their basic work is to reconcile each and every transaction among the departments and find the mistakes or errors.

7. Computer Department
Computer Department are responsible for maintenance of hardware and

software.

System Specification
The System running at Multan Zone is RISC 6000 where RISC stand for Reduces Instruction Set of Computer. Operating System AIX Version 3 where AIX stand for Advance Instruction Execution. This system is purchased from IBM. Oracle 7 Language is used. They are using the Hard Disk Capacity 1.2 GB. Ram is of 64 MB. Backup taken at every week (on Friday). They sent monthly data to P.O. in a floppy in the form of a file having extension of DMP.

Net Working
Technology used is the mixture of star and Hierarchical Net work. There is a distribution box which us used to connect Terminals and Printers. This multiplexer has 16 ports and one terminal or printer can be attach to one port. Multiplexer has two slots Input and Output Slots. Input slot main computer i-e CPU is connected and the output slot, the multiplexer is attached so in this way terminals and printer are Net Work and are placed in different department. 200 Terminals can be connected with this system.

Computerize System
New Business Department. Policy Holder Services. Voucher System. Agency Channel verifies. Payroll. Maturity. Policy Inquiry System.

8. Field Manpower Development Department

Field Manpower Development Department (FMDD) old name was Human resource Development Department (HRDD) plays a vital role in the success and prosperity of state life is business for the development and enhancement of marketing skills of the field and office employees, different courses are offered in this department. The training to S.R.S.O S.M, A.M (field workers) office employees this department has one Manager one Assistant Manager with brilliant qualification marketing kills.

Functions of FMD
Conducting Courses of ISR - BTC, SO-BTC, ADP, MOSC / MOP for Field. Management development courses for Staff. Assists to manage. Arrangement of schedule of Courses. Arrangement of sending a notice to participants of Courses. Checking papers & preparation of Result sheet of courses. Preparation of Certificate of different courses. Maintained all training activity records. Maintaining the accounts of Selling of training books.

9. Group & Pension Department.

Group & Pension Department perform a group and Emigrants insurance.

Group Insurance
Group Insurance means a policy where 10 or more lives are insured under a single policy. According to legislation 10-B, Group Insurance is necessary for workers. Group are not combined only for the purpose of insurance. Group insurance are renew after one year. Renew letter are send to applicant before one month and one month are allowed to applicants after expiry for renewal.

Emigrants Insurance / Counter Insurance

Insurance is necessary for emigrants that go to foreign countries for jobs. Amount Payment = Rs.650 Duration = 2Years Sum assured = 300,000 Renew after 2 years.

Group Pension Scheme:

State life, have become increasingly aware of the predicament of progressive employers wanting to better the lifestyle of their employees by providing financial security and job satisfaction, but not being able to do so, due to lack of availability of avenues and opportunities. This booklet is a guide to the State Lifes Pension Scheme that enables an employer to provide substantial benefits to employees and ensure a higher state of well being for them.

State Life maintains a full-fledged pension Department capable of handling each and every scheme in the most competent and professional manner. It has actuaries, lawyers and other experts, besides offering a unified administrative, technical and investment service. An employer can relieve himself of the tedious and cumbersome work by using the professional service offered by State Life, the major ones being: a) Designing a Pension Scheme according to am employers exact requirements, in addition to determining the rate of contribution etc. b) Preparation of explanatory documents, if required, for consideration by employees. c) Assisting the employers legal advisers with the preparation of Trust deed and Rules. d) Providing reasonable assistance in negotiations with the Central Board of revenue for approval of the scheme. e) Maintenance of Individual records of members of the scheme, their contributions, the employers contribution, pension accrued etc. f) Facilities for payment of pensions, when due Security: All policies issued by State Life are guaranteed and enjoy full financial security, backed by the Government under Article 35 of Life Insurance Nationalization Order 1972.

ii. Payment of Pension:

The pension will be payable by monthly installments; commencing from the retirement of member and ceases upon his death.

iii. Guaranteed Payments: By incorporating a Guaranteed Pension period, payment can be ensured for a defined period say 5 to 10 years, whether or not a pensioner is alive after retirement, if, however, a pensioner survives the guaranteed period, pension will continue throughout his lifetime. iv. Supplementary Benefits:
They may be termed as supplementary, but are indeed those invaluable finishing touches that make the picture complete. Employees would not feel secure unless their families were provided for in the event of their untimely demise. At a little extra cost employees may be given peace of mind by

providing these benefits, some of which are listed below:-

1 Widow's Pension (upon death in service):

The pension will be payable to the wife of a member if he dies while in service. Normally, a widows pension is one half of the members pension entitlement.

2 Widows Pension(upon death after retirement):

The pension is payable to the wife if the member dies after retirement. In this case also a widows pension is one half of the pension the member was receiving. The widows pension, in either case would be payable for life but would cease in the event of remarriage.

3 Orphan's Benefits:
The inclusion of orphans benefits in Pension Scheme along with the widows pension, gives the scheme a level of completeness. A normal scale of orphans benefit is 33% of the widows pension per child, payable upon the childs attainment of age 18 or earlier marriage. Limit is imposed on the number of children who can claim such benefits.

Retirement Aspects:
Pension will be payable to a member according to a predetermined scale on the normal retirement date fixed by the employer.

a) Early Retirement:
A member who retires before his normal retirement date on account of becoming incapacitated, or for any other reason, may be granted a reduced immediate pension to commence on the day following the actual date of retirement.

b) Late Retirement:
A member who remains in employers service after the normal retirement date will receive an appropriately increased pension on retirement.

4 Withdrawal Benefits:
If a member withdraws from the service of the employer before the normal retirement date due to any reason and without any entitlement to early retirement pension, his future contribution, or contribution made on his behalf, will cease. Benefits to be paid on withdrawal will depend upon the withdrawal from service rules of the scheme. In such a case one of the following procedures

may be adopted:

5 Refund of contribution:
If a member withdraws from the contributory scheme a refund is made of all the contributions made by the employee.

6 Deferred Paid-Up Pension:

A withdrawing member may be allowed a deferred paid-up pension of the amount accrued to his account on the date of withdrawal. The reduced pension will commence on his normal retirement date.

10. COMMISSION DEPARTMENT

Commission Department facilitates the field force by offering commission and due bonuses. The department is directed to calculate and analyze the earning of last year, providing advances and loans to the field force and offerings other fringe benefits to motivate the field force. The schedule of persistency ratio and the commission paid is listed in the following table PERSISTENCY RATIO COMMISSION (SYP) Less than 70% Nil 75 76 % 1.5 % 80 81 % 2.0 % 89 90 % 2.9 % 90 % 3.0 % It is experienced that policies sold on yearly basis persist long and considered beneficial both for policyholder and for SR. Loans for conveyance, Ed advances are also offered which are then deducted from the premium with SLIC. As mentioned above for SR, the SM and so are also having persistency commissions, production bonuses.

1. SEGMENTATION/ PEST analysis

Segment is the process of finding the segment that offers greatest potential for success in persuasive communication and to allocate resources efforts to those who are more promising. Markets consist of buyers, and buyers differ in one or more ways. They may differ in their wants, resources, locations, buying attitudes and buying practices, because buyers have unique needs and wants, each buyers potentially a separate market. Ideally, then, a seller might design a separate marketing program for each buyer. Segmentation means finding the segment that shows clear variations in market behavior when compared with other segments.

BASIS FOR SEGMENTATING CONSUMERS

There is no single way to segment a market. A market has to try different segmentation variables, alone and in combination, to find the best way to view the market structure. The following table outlines the major variables that might be used in segmenting consumer markets.

VARIABLES TYPICAL BREAKDOWNS

Geographical/political Region, Country Size, Climate, poltical factors. Demographic/ economical Age, Gender, Family Size, Income, Occupation, Education, Religion , economical factors. Psycho graphic/ social Social class, Lifestyle, Personality Behavioral/ technological User status, Usage rate, Loyalty status, Benefits sought, modern technology usages STATE LIFE INSURANCE CORPORATIONS POLICY SEGMENT CHART

SWOT ANALYSIS OF STATE LIFE INSURANCE CORPORATION

SWOT is the abbreviation of Strengths, Weaknesses, Opportunities and Threats. Strength of the organization can be measured from the activities and resources that give it a competitive edge over competitors. Weaknesses reflect areas where the organization lacks better performance. Threats are the environmental conditions that can effect the performance of organization in order to be more competitive. In light of the SWOT analysis, management also reevaluates its current mission and objectives. Are they realistic? Do they need modification? As we where we want to be right now? SWOT stands for Strength, Weakness, Opportunities and Threats. The main aim of this analysis is to identify the extent to which the current strategy of the organization and its more specific changing taking place in the business environment. The idea of SWOT analysis is to undertake a more structured analysis so as to yield findings, which can contribute the formulation of strategy. SWOT analysis of SLIC is as follows:

STRENGTHS
The following facts reflect the strengths of the State Life Insurance

1 MARKET SHARE
SLIC has 90% Market Share in life insurance business in Pakistan. It makes the corporation more reliable and profitable.

1 EXCELLENT SET UP
SLIC is a large Life Insurance Company in Pakistan and have 27 Zonal Offices and 5 Regional Offices throughout the country.

1 INFRASTRUCTURE
State Life Insurance Corporation is one of the oldest institutions of the

country with a huge setup spread all over the country. The Corporation has four regions and twenty- six zones that provide basic facilities to the Corporation to penetrate deeply in the insurance market.

2 TRAINING ACADEMIES &TRAINING CENTERS

SLIC has 3 training Academies at Karachi, Lahore and Rawalpindi and 26 Training Centers in zonal offices. In 1998, 1946 courses and seminars, ranging from Basic Courses to advanced Programs like ADP, MOP and MMS of LIMRA (USA) had conducted

3 AUTHORISED CAPITAL
State Life Insurance Corporation has got the highest paid up capital in the insurance sector. This fact makes the Corporation the richest Insurance Corporation of the country.

4 GOVERNMENT SECURITY
State Life Insurance Corporation main strength is the security provided by the Government to the policyholders. It makes the Corporation more reliable and self-efficient for policyholders.

5 EXPEIRIENCE.
State Life Insurance Corporation has got an experience of almost 27 years in the life insurance industry that makes it the more experienced Insurer in the country.

6 ADVERTISING &SALES PROMOTION

During 1998, a new penal of four advertising agencies was selected. Outdoor advertising such as installation of Unicode Hoarding display of commercials in PTV is done and other publicity materials such as Calendars, Stickers, Eid Cards, and Posters are produced to boost business activities.

7 ORGANIZATION CULTURE
State Life Insurance Corporations culture reflects devotion, motivation and cooperation that acts as an asset for the Corporation.

8 MARKETING DIVISION
This division is backbone of SLIC. During 1998, 25486 young and educated people were inducted as SR in the sale force, this raising its strength to 256,814, inclusive of SO & SM.

9 SALES FORCE
State Life Insurance Corporation has the biggest sales force in the Life Insurance industry. It helps the organization to push its policies down to the customers.

10 RATE OF RETURN
State Life Insurance Corporation gives highest rate of return. It also provides bonuses to its policyholder i.e. Golden Jubilee Bonuses.

11 GOODWILL
State Life Insurance Corporation is one the oldest Insurance Corporation in the country with a history to support its corporate image. The goodwill created by the Corporation acts as a barrier for the other to follow in the Insurance industry.

12 REAL ESTATE DIVISION (INVESTMENT PORTFOLIO)

SLIC has well-equipped and computerized Real Estate Division in principal office (PO) Karachi supervised by highly qualified staff, engineers and investment analysts.

13 COMPUTERIZATION
About 2/3 working is computerized in SLIC. The Plan to computerize total working is under review.

OTHERS
1 PO conducts marketing survey to analyze environment and develop new plans. 2 Employees are fully devoted and highly paid workers as compare to other organization. 3 It has highest paid up capital. 4 It is reinsured by Swiss Re (Insurance Company Switzerland).

WEAKNESSES WORK OVERLOAD

We saw that in different departments that in some section employees are less to do the work at time. Because capacity of work is more than the employees capacity. Particularly in Policy Holder Services which deals with the policy Holders

LESS JOB ROTATION

Job Rotation in state life is taking part in very rare cases. We saw that people working in the same department dont know the work of other person. By increasing job rotation practice the skills of the employees can be sharpen.

INCOMPETENT FIELD FORCE

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.

 UNDERWRITING
The under-writing process at initial level is based solely on judgmental methods. It should be based on practical methods.

BAD SERVICES
In many departments of state life services provided are not satisfactory for customer. The departments where more improvements are required are,

1 New Business. 2 Policy Holder Serviced. 3 Budget and Accounts.

In all above-mentioned departments there is no nameplate for a particular section or a particular authority. New business department doesnt provide the medical facility for the new customer at the moment. We saw in PHS that people were unaware to where they should go for their case. Internal office setting and arrangement is not satisfactory as compare to its competitors.

CENTRALIZED DECISION MAKING

Managerial decision-making is totally centralized in the PO Karachi, Zonal Offices follow the instruction and rules & regulations provided by PO. Sometimes decisions is taken by PO is not strategic and adjustable in the local environment. For prosperity & survival of the organization, decentralization (to some extent) is necessary.

INTERNAL DEPARTMENT INEFFICIENCY

1 Underwriting process (in NB Department) takes longer time period, which irritates the prospects. 2 Loan section takes 10 days to process. 3 Normally 1 to 2 months is required to surrender the policy and take the Survival Benefit, which is not justified.

SELECTION & RECRUITMENT

SR are selected and recruited by SO & SM irrespective of their education and unique internal attributes.

1 FEED BACK
The Corporation does not have any effective and efficient feed back channel to disseminate sales force suggestions to upper management. Further, organization has no well organize system for feed back between office employees and manager, managers and Board of Directors.

2 FRAUDS
Frauds done by some deceives field workers who deteriorate the good will & image of the organization. OPPORTUNITIES

3 PER - CAPITA PREMIUM

In Pakistan per capita premium payment is $1.5 and $1.7 only for life & general insurance respectively. There is an opportunity to enhance this nominal rate. In Japan per capita premium for life insurance is $3810.

4 POPULATION GROWTH RATE

In Pakistan, population growth rate is approximately 3%. It is a great opportunity for insurance sector.

5 INUSRED POPULATION
In Pakistan 2% to 3% population is insured while rest of the population provides opportunity to life insurers to enhance their business.

6 GOVERNMENT REGULATION
Section 10-B of Pakistan Commercial and Industrial Standing Ordinance 1968 provides the compulsory insurance of all the employees of the organization (whether private or govt. ). So it is a great opportunity to SLIC.

7 ENTRY BARRIERS
To enter in the insurance business huge investment is required. Further 40% of premium are compulsory for the private insurers, to cede to Government of Pakistan security purpose creating the entry barrier.

THREATS 8 COMPETITORS
The existence of local and government insures such as EFU, CU and Metropolitan. ALICO etc. is threat to the survival of SLIC.

9 POLITICAL INSTABILITY
Political instability looses the confidence of the policyholders. Further rules and regulations of government are subject to change creating threat to insurance business.

10 FEAR OF WAR
The relationships of Pakistan with India are not satisfactory due to Kashmir dispute. There is always a fear of war creating the threat to corporation and policyholders.

11 INVESTMENT CLIMATE
Due to the political instability and government changeover the investment climates are not satisfactory in the country. So the return from real estates and other activities is deteriorated.

SUGGESTIONS & RECOMMENDATIONS

Suggestions are the keys to success, proper working and prosperity of the corporation. During our internship-training period we conducted some interviews from the policyholders and has taken their suggestions.

Recommendation from the interviews of policyholders

1. In PHS department different section should be properly separated, so that it will be easy for customer to reach their concerned section. 2. There should be proper sitting arrangement. Particularly in PHS and NEW BUSINESS department, no of chairs should be increased. 3. There should be a General Information Cell on the ground floor, because when most of the policyholder are illiterate and cant understand the map given at ground floor. 4. The reception should be attractive, and must bear all the relevant informations which ever the policy holder requires 5. Sales Rap should properly guide to the policyholder. 6. In some departments policyholders are not kindly being served. So this thing should be removed, because if they dont behave well with the policyholders then they may lose their existing and potential customers.

SOME OTHER RECOMMENDATIONS

1 There should be a complaint cell in the building of state life insurance corporation. This will enhance the credibility of the company. This will lead them towards customer satisfaction. 2 There should be Job Rotation for the employees working in the state life either in the same department or in some other departments. 3 All the working of SLIC should be fully computerized. All the zonal Offices should be interconnected. 4 State Life Insurance Corporation should arrange some documentary program on TV order to create awareness in the potential customers.

5 There should be an educational program for field members as they promote from SR TO SO, SO TO SM and so on. Because the people on the higher post should be at least graduate. 6 Behavioral training should be given to field force and they should be motivated not to deceive the innocent policyholder. 7 There is a need of more and extensive training program for office workers. 8 Flexible pay system should be introduced in the corporation to motivate the workers to do more work. 9 The labor union of SLIC should be more competitive for the betterment of their workers. 10 Quick service should be provided to policyholders in case of underwriting. 11 Two-way feedback is compulsory between corporation and employees (office & field). 12 Proper concentration should be given to the inputs of the field force. All the requirements and rules & regulations should be critically met before selection and recruitment of field force. 13 Field force and office workers should be strictly asked to wear the proper uniform developed by SLIC while they are on the job. 14 The employees should be rotated from one job setting to anther. So that in case of emergency there should not be a working problem.