Company as a Whole



        THE ORIENTAL INSURANCE COMPANY LIMITED----INDIA

The Oriental Insurance Company Ltd was incorporated at Bombay on 12th September 1947. The Company was a wholly owned subsidiary of the Oriental Government Security Life Assurance Company Ltd and was formed to carry out General Insurance business. The Company was a subsidiary of Life Insurance Corporation of India from 1956 to 1973 ( till the General Insurance Business was nationalized in the country). In 2003 all shares of our company held by the General Insurance Corporation of India has been transferred to Central Government.

The Company is a pioneer in laying down systems for smooth and orderly conduct of the business. The strength of the company lies in its highly trained and motivated work force that covers various disciplines and has vast expertise. Oriental specializes in devising special covers for large projects like power plants, petrochemical, steel and chemical plants. The company has developed various types of insurance covers to cater to the needs of both the urban and rural population of India. The Company has a highly technically qualified and competent team of professionals to render the best customer service.

Oriental Insurance made a modest beginning with a first year premium of Rs.99,946 in 1950. The goal of the Company was “Service to clients” and achievement thereof was helped by the strong traditions built up overtime.

ORIENTAL with its head Office at New Delhi has 23 Regional Offices and nearly 900 operating Offices in various cities of the country. The Company has overseas operations in Nepal, Kuwait and Dubai and has a plan to open office in Qatar too.The Company has a total strength of around 16,000 employees. From less than a lakh at inception, the Gross Premium went up to Rs.58 crores in 1973 and during 2007-08 the figure stood at just over IRs. 3900 crores.


Our Corporate Mission

To contribute to the socio economic objectives of the nation by being a vibrant and viable organization catering to the growing insurance needs of the community. Towards this end we will strive for effective management of business operations.


Our Corporate Objectives

    1. To serve better the insurance needs of the entire community, keeping CUSTOMER as the focus.
    2. To strengthen our tradition of being CUSTOMER - FRIENDLY, in order to provide quality service.
    3. To manage Business profitably, manage funds judiciously and deploy investible funds for optimum yield.
    4. To optimise the retention of Indian business and conduct reinsurance and international operations in the best
         interest of the country.
    5. To work towards minimisation of losses and develop Risk Management Technologies.
    6. To function as a strong and dynamic non-life insurer.


Management

Oriental Insurance is a professionally managed independent Board-run Company. Illustrious personalities like Shri T.A.Pai ( who later became Cabinet Minister in the Union Government ), Shri K. R. Puri, who rose to be the Governor of RBI and Shri B.D.Pande (who later became the Governor of West Bengal) were among our past Chairmen.

 At present
Dr. A.K. Saxena is Chairman-Cum-Managing Director of our Company. The Board of Directors of our Company include eminent personalities in various fields.


Financials

The Company’s Gross Direct Premium Income in India during the year 2007-08 (Audited) was Rs.3808.13 crores and the Premium Income outside India was Rs.92.07 crores. The Gross Direct Premium in India & abroad showed a growth of -3.00%. The Net Premium Income (Domestic and Foreign), on the other hand grew by -0.04% from Rs. 2879.74 crores in 2006-07 to Rs. 2878.67 crores in 2007-08.




The company’s operations in Nepal, Dubai and Kuwait yielded a Gross Direct Premium of Rs. 92.07 crores during the year 2007-08 as against Rs. 92.26 crores during the previous year. The net premium on foreign operations stood at Rs. 90.37 crores and as against this, the Net Incurred Claims during this year in respect of foreign operations were Rs.81.47 crores at 90.16%. The foreign operations have resulted in an overall deficit of Rs. 21.38 crores.

After taking into account the income from Interest, Dividend & Rent of Rs 535.72 crores and Profit on sale of Investments of Rs571.19, we have posted a pre-tax profit of Rs 442.35 crores & post-tax profit of Rs. 9.30 crores for the year 2007-08.


As against the desirable Solvency Margin of 1.5 mandated by the Indian regulatory body, IRDA, the available Solvency Margin is 1.91 as at 31st March 2008.

The Company had a documents issuance ratio of more than 98% during the year, having issued 96.76 lacs documents approximately. The claims disposal ratio for non-suit claims settlement ratio was 88.67%.


The Company is not only “IT friendly” but also “Technology Savvy”. We have our own website in place. An integrated Non-Life Insurance Application Software (INLIAS) is under implementation and is expected to be in place shortly. This will ensure that our Customer Service parameters grow by leaps and bounds.

No wonder, The Oriental Insurance Company has been enjoying the highest rating from leading Indian credit rating agencies CRISIL and ICRA. The Company has also been rated as B++(Very Good by AM Best, an international rating agency.

 


Financial Snapshot 2007-08 & 2006-07

Figures in brackets are percentage to net premium                                                           (Rs. in lakhs)


 

Fire

Marine

Miscellaneous

Total

2007-08

2006-07

2007-08

2006-07

2007-08

2006-07

2007-08

2006-07

Gross Direct Premium:               In India

47820

54007

 33906

 34783

 299087

 304062

 380813

 392852

Outside India

1786

1669

1261

1567

6160

5990

9207

9226

Gross Direct Premium Total

49606

55676

35167

36350

305247

310052

390020

402078

Net Premium

29712

35172

18629

15844

239526

236958

287867

287974

Ratio of Net to Gross

59.90 %

63.17%

52.97 %

43.58%

78.47 %

76.42%

73.81 %

71.62%

Profit on Sale of Investments (Policy Holders’)

3469

(11.7%)

3303

(9.4%)

1851

 (9.9 %)

1962

(12.3%)

34715

(14.5%)

37883

(16.0%)

40035

(13.9%)

43148

(15.0%)

Int./Div./ Rent (Policy Holders’)

3470

(11.7%)

3083

(8.7%)

1851

(9.9%)

1831

(11.6%)

34730

(14.5%)

35362

(14.9%)

40051

(13.9%)

40276

(14.0%)

Commission and other income (Net Income(+)/ Net Outgo (-))

679

(2.3%)

1344

(3.8%)

-1042

(-5.6%)

-393

(-2.4%)

-12737

(-5.3%)

-10921

(-4.6%)

-13100

(-4.6%)

-9970

(-3.5%)

NPA (Provision (+)/ Write back(-))

71

(0.2%)

-31

(-0.1%)

38

(0.2%)

-18

(-0.1%)

705

(0.3%)

-355

(-0.2%)

814

(0.3%)

-404

(-0.1%)

Diminution in value of shares (-)/ written back (+)

-1

(-0.0%)

-2

(-0.0%)

0

(0.0%)

-1

(-0.0%)

-9

(0.0%)

-27

(-0.0%)

-10

(0.0%)

-30

(-0.0%)

Increase (-)/ Decrease (+) in unexpired risks reserve

2730

(9.2%)

-1019

(-2.9%)

-1689

(-9.1%)

100

(0.6%)

-1284

(-0.5%)

-17978

(-7.6%)

-24

(-0.1%)

-18897

(-6.6%)

Net Incurred claims

-31037

(-104.5%)

-15939

(-45.3%)

-11008

(-59.1%)

-15584

(-98.4%)

-218177

(-91.1%)

-204362

(-86.2%)

-260222

(-90.4%)

-235885

(-81.9%)

Expenses of Management

-10688

(-36.0%)

-11340

(-32.2%)

-5560

(-29.8%)

-5255

(-33.2%)

-66112

(-27.6%)

-58828

(-24.8%)

-82360

(-28.6%)

-75423

(-26.2%)

Amortization expenses

-74

(-0.2%)

-60

(-0.2%)

-39

(-0.2%)

-36

(-0.2%)

-738

(-0.3%)

-686

(-0.3%)

-851

(-0.3%)

-782

(-0.3%)

Investment Written off

-8

(0.0%)

-13

(-0.0%)

-4

(0.0%)

-8

(-0.0%)

-76

(0.0%)

-153

(-0.1%)

-88

(-0.0%)

-174

(-0.1%)

Net Operating Profit

-1677

(-5.6%)

14498

(41.2%)

3027

(16.2%)

-1558

(-9.8%)

10543

(4.4%)

16893

(7.1%)

11893

(4.1%)

29833

(10.3%)

Interest, Dividends & Rent (Shareholders’)

17118

15732

Profit on sale of Investments (Shareholders’)

17110

16853

Other Income/ Outgo

-1886

546

Profit (+) / Loss (-) before Tax

44235

62964

IT deducted at source and Provision for Tax

-4429

-6348

Provision for Tax for earlier years

-38876

-6889

Net Profit/ Loss after Tax

930

49727

Transfer to General Reserve

53

38028

Provision for Dividend

750

10000

Corporate Dividend Tax

127

1699

* Percentages mentioned above are to Net Premium


Five Year Digest
(Amount in lacs)

 

2003-04

2004-05

2005-06

2006-07

2007-08

Gross Direct Premium

289974

309055

360977

402078

390020

Net Premium

203303

221802

250046

287974

287867

Net Claims

158764
(78.1%)

190838
(86.0%)

206475
(82.6%)

235885
(81.9%)

260222
(90.40%)

Operating Expenses

78211
(38.5%)

72988
(32.9%)

85076
(34.0%)

75423
(26.2%)

82360
(28.6%)

Underwriting Profit / Loss (-) **

29756
(14.6%)

21338
(9.6%)

14438
(5.8%)

29833
(10.3%)

11893
(4.1%)

Interest, Dividend and Rent **

8514

14918

 
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