Finance Project on Icici Lombard by aic74722

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									Financial Highlights
                                                                Rs. in million

                                                             2003-04             2002-03

Number of policies                                           249,531             98,293
Gross written premium                                        5364.8              2161.0
Earned premium                                               790.8               272.3
Underwriting surplus/(deficit)                               167.9               (107.1)
Profit before tax                                            422.4               41.9
Profit after tax                                             317.8               33.0

The profit after tax for the year ended March 31, 2004 was Rs. 317.8 million. After taking into account the balance of
brought forward loss of Rs. 59.8 million, the profit available for appropriation is Rs. 258 million.

We have finished the year as the number one private sector general insurance company in India. This position is
supported by a robust financial performance along with all round development of key business functions

Capital

In order to enhance the risk retention capacity and to maintain healthy solvency ratio, the Company came out with a
right issue of Rs. 1100 million in July 2003, which was fully subscribed by the shareholders. The paid up capital of
the Company as on the Balance Sheet date is Rs.2200 million, which is highest amongst the private sector general
insurance companies.

Company Performance

Gross Written Premium has grown by 148% for the year ended March 31, 2004, to Rs. 5364.8 million, up from
Rs.2161.0 million for the previous year. The Net Profit before tax has
grown by 908 % to Rs. 422.4 million, as against Rs. 41.9 million for the previous year.

The Net premium income for the year is Rs. 1298.1 million, 191% higher compared to Rs. 445.3 for the previous
year. The Company sold 249,531 policies during the year, registering a growth of 154 % over the 98,293 policies
sold during the previous year.


Strong Parentage

ICICI Lombard General Insurance Company Limited is a 74:26 joint venture between ICICI Bank Limited – India’s
second largest bank and Fairfax Financial Holdings Limited - a US$ 26 Billion diversified financial services corporate
engaged in general insurance, reinsurance, insurance claims management and investment management. Lombard
Canada Ltd., a group company of Fairfax Financial Holdings Limited, is one of Canada’s oldest property and casualty
insurers.

As an alliance, ICICI Lombard combines the forte of these two most trusted names in the financial sector. It
leverages ICICI Bank's strong brand equity, extensive distribution network and sound technological infrastructure to
serve customer needs. This joins forces with Lombard's domain knowledge, product innovation and business
processes based on international best practices in the insurance business. To the Indian consumer this means the




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security of strong parentage with access to a range of customized and innovative insurance solutions that is
supported by internationally benchmarked service levels.

Commencing operations in September 2001, after the general insurance sector was thrown open to private sector
participation, ICICI Lombard was one of the first private sector general insurance players to achieve break-even
levels in the first full year of its operations. For the year gone by (2002-03), ICICI Lombard garnered premiums worth
Rs. 2.15 billion and its net profits grew to Rs. 33 million. ICICI Lombard has also doubled its equity capital from Rs.
1.1 billion to Rs. 2.2 billion.


Comprehensive Product Range

ICICI Lombard has a major presence in the following insurance segments:
    •   Personal solutions – Motor, Home, Personal Accident cover
    •   Business solutions – Fire, Inland transit, Engineering, Performance Guarantee, Merchant cover, Marine Hull,
        Aviation Hull, etc.
    •   Travel & Health solutions
    •   Project solutions – Contractor’s / Industrial / Erection All Risk, etc.
    •   Liability solutions (Directors & Officer’s Liability, Errors & Omissions, Product Liability, Public Liability,
        Professional Indemnity)
    •   Exports solutions (Export Import, Export Credit)
    •   Rural solutions (Tractor, Weather Index, Janata Personal Accident...)

ICICI Lombard has already introduced a slew of products and has emerged as a major player in the corporate and
retail segments driven by a well-balanced portfolio. The Company has some of the largest industrial houses and
companies representing diverse industries as its customers.

ICICI Lombard has also made forays into specialized products, those that require complex product development and
strong underwriting skills. One area is the comprehensive weather index insurance that protects the insured against
the vagaries of nature. This product is based on scientific hard data making the authentication and payment of
claims quick and efficient. This was developed in association with the World Bank and ICICI Bank. Other areas
requiring complex product structuring include Representations and Warranties, Sureties and Credit Guarantee
Insurance.


IT Enabled Services

ICICI Lombard is committed to providing the customer total transparency and control over his insurance portfolio.
The effective use of technology platforms has enabled customers to view all their insurance transactions through
the web on a real time basis. A customer can also transact business with the company through its corporate website
on several products such as home, travel, fire, health and marine. In addition, the website offers a unique free "Ask
the Expert" service which can be availed by anyone visiting the site. An unbiased opinion on any insurance policy
from any company is offered.

ICICI Lombard is one of the few insurance companies that links all the insurance policies taken by a customer for the
company or a group of companies to a single cash deposit. This initiative has reduced the need for deposits
maintained with the insurance company, thereby assisting the corporates in working capital management.


Globally benchmarked Service Standards

ICICI Lombard offers its customers benchmarked service standards. A customer has access to offices in 55 cities,
over 300 relationship managers and 1000 insurance advisors across the country. The Company has an interactive
website and a state-of-the art, 24 X 7 call center to enable customers to stay in touch. When a claim is reported, a
surveyor is onsite within 24 hours. An interim payment, if needed, is made within 7 days of claim and the final
payment within 7 days of completion of documentation. Making sure that life and business goes on uninterrupted.




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The Management Team

Mr. Sandeep Bakhshi, Managing Director and CEO, ICICI Lombard, is responsible for the non-life insurance
business of ICICI Bank Limited. He joined ICICI in the 1986, as an officer in the Operations Department in the
Northern Zonal Office, in Delhi. His job responsibilities included business development, project appraisals, project
monitoring and business restructuring. He was appointed Senior Vice President in 1996 and apart from project
finance was also given the charge of the Risk Management for the Northern Zonal Office. He subsequently looked
after the corporate clients for the Northern and Eastern regions of ICICI before joining ICICI Lombard in 2002. Mr.
Bakhshi is a Mechanical Engineer from Punjab Engineering College, Chandigarh and holds a Management degree
from XLRI, Jamshedpur.

Mr. R. Rangarajan, Technical Director, ICICI Lombard is responsible for advising on various matters of general
insurance in the company, especially in the areas of product design, customer service, regulatory aspects and
processes and settlement of claims. He joined ICICI in 1999 as a consultant for general insurance business and was
largely involved in the licensing process for ICICI Lombard. Prior to joining ICICI, he was working with New India
Insurance Company as General Manager. He has over 40 years of work experience in general insurance in various
capacities. He holds a Masters degree in Statistics and is fellow of Association of Federation of Insurance Institute,
India.

Mr. K. Bharathan, Regional Director, a chartered accountant, joined ICICI Lombard in 2002 and is responsible
for business development for southern region. He joined ICICI in 1981 and has varied experience in Project
financing, monitoring as well as rehabilitation of sick companies in southern region. Prior to joining ICICI, he was
working with Commercial Bank as Senior Manager. He also holds a commerce degree from Madras University.

Mr. Alok Agarwal, Head – Corporate Relations, joined ICICI Lombard in 2002 and is responsible for business
development for east, west and north regions. He joined ICICI in 1993 and was responsible for business
development, project appraisals and project monitoring. Prior to joining ICICI, he worked with Reliance Industries as
process engineer. He is a Chemical Engineer from Jadavpur University and holds a Management degree from IIM,
Calcutta.

Mr. Dilip Jashnani, Head – SME, joined ICICI Lombard in January 2001 and is responsible for business
development for central region. Prior to joining ICICI Lombard, he has worked with National Insurance, having
varied experience in underwriting, claims and headed the largest divisional office of National. He holds a degree in
Science and Marketing Management from Bombay University and is also an Associate of Insurance Institute of India.

Mr. Ritesh Kumar, Head – Risk & Product Development, joined ICICI Lombard in 2002, and is heading Risk,
Reinsurance and Product development functions. He joined ICICI in 1992 and was responsible for business
development, project appraisals and project monitoring. He has also been involved in the Structured Product Group
of ICICI which did some of the first securitisation deals in India. He was promoted to Deputy General Manager in
2001. He is a Commerce graduate from Shriram College of Commerce, Delhi and did his business management
from Faculty of Management Studies, Delhi.

Mr. Kartik Jain, Head – Marketing & Alliances, joined ICICI Lombard in 2002 as Vice President and is currently
heading Marketing and Retail functions. Prior to joining ICICI Lombard, he has worked with KPMG Strategy
Consulting in London and Mumbai and with Cadbury in Sales and Marketing. He is a Mechanical Engineer from IIT,
Mumbai and completed his PGDM from IIM, Calcutta.

Mr. Rakesh Jain, Head – Finance, Operations & Customer Service, joined ICICI Lombard in 2001 and heads
Finance & Accounts, and Customer Service functions. He joined the Risk management department of ICICI in 1998,
when ICICI took over ITC Classic. He is a Commerce graduate from Xaviers’ College, Calcutta and holds ICWA and
CA degrees.

Mr. Sudhir Salian, Head – Retail, a chartered accountant, heads the strategy function for ICICI Lombard and is
responsible for leading the direct technology initiatives for the company. The technology function also reports into




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this group. He joined ICICI as a Vice President in the Retail Risk Management function in 1999. Prior to this, he has
worked for Standard Chartered Bank in various capacities in the retail banking business.

Mr. Zubin Mody, Head – Human Resources, Vice President, is heading the HR function in ICICI Lombard. He
joined ICICI in the 1999 as AVP – HR in Mumbai, and was responsible for Performance Management, Compensation
and Organization Development. He was promoted to Senior VP in 2000. He graduated from Bombay University with
Physics (honours) and did his management from XLRI, Jamshedpur.




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