Allianz Insurance: Claims Process, Products, and Regulatory Report

This report examines the claims process, products, and regulatory environment of Allianz Insurance Limited, focusing on its operations in Malaysia. The report analyzes the types of claims received, particularly those related to automobile insurance, including comprehensive vehicle coverage, thi...Read More

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Introduction
This report has been prepared in order to have a proper understanding of the sort of claims that are
requested by the customers and the time and the process that is undertaken with the help of which
the companies are able to process the claims. The process and the sort of claims that are seen and
the product that faces most of the claims will be analysed. The trend of claims and the indemnity
process faced by the company will be known and thereby proper recommendations can be made
with the help of which the performance of the company can be enhanced. The company that has
been selected for this report has been Allianz Insurance Limited.
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Brief Context
The actual intention of the report has been to assess some of the products that are offered by the
insurance companies to the general public and the same products are even offered for the business
purposes as well. It is seen that insurance industry is a niche industry and therefore the companies
that are operational have their set of products which they offer for sale. It is seen that insurance is
one of the key elements that are required by the general public as well as the companies with the
help of which everyone secure themselves. Accordingly Allianz Life Insurance has been taken into
consideration, which is operational in Malaysia. The report will even analyse the transformations
and the advantages, which have been made in the policies in accordance to insurance products and
these policies are related to the products that they provide (Al-Amri 2015). The report will even
assess how the transformations have taken place in the insurance policies can have an impact on any
kind of claims that are to be received by the policy holders. The assignment will even go in-depth
with respect to the information and the details in accordance to the regulatory and legislative
features and these features are associated to two products that are given by the organization.
The management of claims is a significant aspect and therefore the company has their own set of
employees which forms a team, who are working efficiently among the cover profiles and any sort of
risks by making use of the department of claims and their information system (Yunos et al. 2016).
The number of employees in the department is equivalent to the requirement of the business. Most
of the claims that have been brought in have been dealt internally however in some of the cases the
claims are outsourced with the help of which the claims are settled.
Insurance Product
Allianz Life Insurance Company is recognised to be one of the well known insurance companies that
are operational in Malaysia and they have been performing in an effective manner. The organization
has extensive product range and delivers services as well and with the help of this the company can
attain profit. The organization gives out an extensive range of products and services related to
insurance and these products are greatly used by the people and the companies. In Malaysia, it is
seen that there has been changes in the insurance laws and the changes have made significant
amount of changes in the claims that are asked by the companies.
It is seen that the risks that are related to the insurance products are dependent on the sort of
benefits they provide. The company has several sorts of products and the product that is ideal will
depend on the need of the client. However, the changes in the insurance policies and rules have
made changes in the claim process and the amount that can be received. One of the key changes
that have been observed has been in the automobile insurance and it is seen that such products are
demanded by most of the public (Azhar, Ghazali. and Mamat 2016). Therefore, automobile
insurance is one of the significant insurance that is largely purchased and hence is in greater amount
of demand. In Malaysia, it is seen that they have their own laws and policies and accordingly
maintaining automobile insurance is compulsory and therefore who are having automobiles has to
purchase the same. The rule has been laid down in the Road Transport Act 1987 and accordingly the
government and the concerned authorities take strict actions and strategies with the help of which
people are bound to maintain their insurance. As automobile insurance is a key aspect, it is due to
this fact that the insurance demands for the same have enhanced. Any new automobiles that have
been purchased requires a coverage through insurance with the help of which the safety of the cars
can be maintained and this even followers the protocol framed by the Malaysian economy and this
even followed by the management of the organizations.
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The changes that have been made in the policies have brought in significant amount of
transformations in the motor vehicles insurance coverage. It is seen that there are several sorts of
options of coverage that can be purchased by the customers and these requirements and demands
are provided by Allianz.
Some of the key products related to automobile coverage have been comprehensive vehicle
coverage and this is a general insurance product that covers the car from any sort of liabilities. This
product provides coverage from loss or damages of the car due to any kind of accidents and other
unprecedented events (Mohamed, Zakaria and Udin 2017). Third party death and injuries are even
covered in this product. Third party damages and losses are even covered and extended benefits are
given as well. The other product that has been discovered has been third party cover to the cars and
motorcycles. Third party fire and theft coverage is another product that can be used by the public as
it is seen that the other products are Allianz Motorcycle Plus and e-Hailing Add on.
There are even products that offer road side assistance as well and in this manner the customers are
safeguarded from each and every aspect. The minimum coverage that the company has to offer has
been explained in the Road Transport act 1987 and this seen to be the general coverage. The road
side safety coverage has been a special that is offered by the company and this product is of great
demand in the market. All these products extensive level of security and in order to attain the same
the clients have to provide a certain fee.
Product Underwritten
There are several products that have been underwritten by the company. However, one of the
products will be taken into consideration with the help of which the cause of underwriting can be
known. It is seen that the product that has greater significance will be discussed. Comprehensive
vehicle coverage is the product that has been underwritten. This product is of great demand in the
market and most of the customers purchase this product in order to secure their automobiles from
any kind of accidents. It is due to this fact that the company underwrites the product as they are
aware that the product will never lose its significance (Yunos et al. 2016). This product has simple
clause and the amount of premium is dependent on the sort of car and the accidents that have
taken place. The amount of purchase for this product is very high and therefore the revenue that is
attained by the company is high as well. It is seen that there has been a rise in the level of demand
as the amount of premium for the company is comparatively low in accordance to the other
companies. There are several sorts of claims that have been observed and the company has to
undertake proper assessment and scrutinise the claims in a proper manner. A team of experts who
are available in the company are the ones who undertake the investigation and thereby the
authenticity of the claim can be understood. The process of claim is a lengthy one and therefore
certain time has to be given with the help of which the claim process can be completed. General
insurances do not have any special causes and therefore it is easier for the customers to have an
understanding.
Analysis of the Causes of Claim Trend
It is seen that the general vehicle insurance has the ability to cover various areas of a vehicle and
therefore their sort of claims are variable and different as well. The claims department receives
various requests and they have to understand the claims properly before taking any actions. Each of
the claims has their own way of handling and management and the department takes all the steps
by following the protocols maintained by the company. Most of the claims are common but the
special cases that are received are given utmost care and attention. In some of the cases it is seen
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that false claims are even requested and in order to understand these claims the department has to
understand and take various actions so that the claim process can be initiated. The claims which are
received undergo several steps with the help of which each and every action can be understood with
the help of all the points can be understood in a better way (Arifin, Daud and Norhayateb 2018). The
frequency of claims differ in different time period of the year however, the claim request is coming
all over the year. The most frequent claim is seen has been for the car damages. Car damage claims
are the most frequent and therefore the most significant one as it is seen that such claims are
coming all over the year. The claim for damaged cars has been from low level to complex levels and
the company has to assess the level of damage properly before they can proceed with any claim. The
company has the idea that the demand of general insurance has been high and therefore the
indemnity that is given can be covered up as well. It is mostly seen that the amount of claim given to
the customers are lower than of the new product requests within the company (Muhamat, Jaafar
and Alwi 2017). Therefore the amount of profit that the company attains is more than that of the
indemnity given. It is seen that the company has knowledge on how much the indemnity they have
to provide in a year and accordingly the price of the products are placed. The amount of premium
depends on the number of years the vehicle has been running and the sort of car and the damage
that has been expected to occur. In this manner the sort of trend for the product identified has been
understood and in this manner indemnity amount is known. It is seen that most of the claims take
place during the time of monsoon as at this time the frequency of claims increase significantly.
In recent years there has been significant increase in the trend for claims for most of the insurance
products. There is a lot of risks which is associated with natural and manmade factors which affect
businesses (Lamond and Penning-Rowsell 2014). In the case by Allianz, the global trends for claims
has significantly increased over the years. In addition to this, there are certain risks as well which are
affected by human factor as well. The main reasons which can be identified for the increase in the
global trend of claims is due to several reasons some of which are manmade while some of the same
occur due to natural reasons (Mohleji and Pielke Jr 2014). In addition to the landscape risks which
companies faces, there are also regulatory and legal fees which can affect the operational process of
the business (Pugely et al. 2015). The factors which ate discussed above affect the successful
operations of the business and in such circumstances the role of the insurer becomes very important
as the risks which are faced by the businesses needs to be minimized.
There has been an indication that most of the claims that have taken place have been towards the
comprehensive vehicle coverage (Zulkifli et al. 2015). With the advent of time there has been an
observation that the extent of risks have increased among people and therefore the extent of claims
have increased. The trend of claim has been found to be rising and therefore one can say that the
risk factors have increased. The claim that is found in accordance to the selected product has been
mainly among the middle aged group and most of their claims have been accident related claims.
The need for motor vehicle coverage product has been seen to be high during monsoon and the
therefore the extent if claims are higher at that point of time (Ali and Isa 2015). The extent of
accidents and crashes due to visibility and wet roads become higher and this increases the extent of
claims during monsoon. There has been a rise in around 12% rise in the claim for the concerned
product for the past 5 years. The concerned product of Allianz is a renowned product and has
several kinds of features and therefore the demand for the product is significantly high in the
market.
There has been an observation that the sort of claim towards this product has been changing with
time and earlier which the claims which used to come mostly for small vehicle to vehicle accidents
have changed to compensation towards human health due to accidents (ABDULLAH and YUSOF
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2018). In order to stay active in the market the company has even reduced their premium rates and
therefore it has been observed that the extent of claims in the current period has increased as the
customer base has increased as well. The incorporation of add on products within the coverage even
increases the level of claims. The trend of claims has been significantly similar but the frequency and
the mode of claim has changed as well.
The concerned department of the company looks into the claims and takes necessary actions in
resolving the claims and they have identified the fact that the company has been paying of claims
more in the current time period in comparison to the past few years. The other sort of claim that has
been observed has been damage of vehicles due to any kind of natural calamities. (Wüthrich and
Merz 2013) This feature has been added within the feature of comprehensive vehicle insurance
product and therefore any kind of claims due to this incident is taken care of by the company with
great care and significance. It can therefore be stated that trend of claim has been mainly accident
related and safeguarding of vehicles with the help of financial remuneration.
Recommendations
The recommendations that will be provided on the basis of the analysis will be only for the
concerned product and the actions that can be undertaken with the help of which betterment of the
product can be made. The assessment has created various suggestions and these suggestions have
been prepared so that the company can increase their level of profit and customer base.
1. The management of the company needs to review the situation of the client before selling any
insurance product to the client. This would help the management of the company to avoid any risks
which is related to indemnity.
2. Another step which needs to be taken by the management of the company is adhere to all rules
and regulations of the business so that a situation of indemnity does not arises for the company for
violation of legal status and regulations.
3. The insurance company needs to make a proper assessment of the risks which is associated with
the client business and then take decisions regarding the same in respect of the business.
4. The management of the company can add constructive terms and conditions to the product which
needs to be adhered by the client. This is done by the management of the company so that the
business can be protected by the terms and agreements in case of normal damages.
5. Various new features can be added with the product so that it becomes more attractive for the
customers to purchase the product.
6. It is recommended that the company has to undertake an assessment of the market from time to
time in order to have an understanding of the expectations the customers are having from the
product so that the company can add in the features that are possible.
7. Another suggestion that can be given is that the company has to take special consideration on the
cases of indemnity so that the customers are satisfied and the level of profit and customer base can
be maintained.
8. It can even be recommended that the company can bring in special clause for the customers who
have not made any claim within five years so that the customer can gain loyalty with the help of
which the customer retention can be done.
Conclusion
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The completion of the report has been helpful in creating a better idea about the claim process
which is faced by Allianz Insurance. The report highlights the sort of products that are offered by the
company and the features of all the products. The product that has increased level of demand has
been highlighted and the factor due to which the demand for the product is high has been
addressed as well. The causes in the trend of claims have been explained in this report and the sort
of claims that are mostly received by the company has been explained. There are several kinds of
claims that are received by the company however the one that receives the increased number of
claims can be understood. It is even seen that the role of the employees working in the claim
department will be known and their performance effectiveness can be known. The causes
indemnity faced by the company and the sort of indemnity process that is undertaken by the
company is effectively understood and thereby one can say that there is higher level of risks that the
company faces in the indemnity process. The report explains the fact that indemnity process is
effectively managed by the company and the incorporation of the recommendations highlighted will
improve the performance of the company.
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Referencing must be completed before submission
All sources must be referenced in the body of your answer as well as in your reference list. See
the 820Specimen coursework assignment and answer for examples of how to reference
correctly in text and in your reference list.
References
ABDULLAH, M.A. and YUSOF, M.I., 2018. Higher Risk of Motor Vehicle Accident in Female Motorcyclist
with Type 3 Digit Ratio (2D: 4D). Journal of Clinical & Diagnostic Research, 12(12).
Agcs.allianz.com (2019). . Retrieved 17 May 2019, from
https://www.agcs.allianz.com/content/dam/onemarketing/agcs/agcs/reports/AGCS-Global-Claims-
Review-2018.pdf
Al-Amri, K., 2015. Takaful insurance efficiency in the GCC countries. Humanomics, 31(3), pp.344-353.
Ali, H. and Isa, K., 2015, May. DETERMINANTS OF MOTOR TAKAFUL PATRONAGE AMONG COMMERCIAL
VEHICLE OPERATORS: A CONCEPTUAL REVIEW. In 1st Academic Conference of Accounting and Finance
(p. 368).
Arifin, N.M., Daud, W. and Norhayateb, W., 2018. TAKAFUL RULES AND REGULATIONS IN TAKAFUL
INDUSTRY FOR MALAYSIA. PROCEEDINGS–ICLG 2018, p.107.
Azhar, N.N.Z.A., Ghazali, P.L. and Mamat, M., 2016. Modification Mathematical Modelling for Motor
Tariff of Auto Takaful in Malaysia. In AND TOURISM RESEARCH CONFERENCE 20-22 APRIL 2016 (p. 101).
Lamond, J. and Penning-Rowsell, E., 2014. The robustness of flood insurance regimes given changing
risk resulting from climate change. Climate Risk Management, 2, pp.1-10.
Mohamed, N.N.N., Zakaria, W.N.W. and Udin, M.S.S., 2017, October. FRAUD RISK MANAGEMENT OF
THE INTERNAL PROCESSES FOR MOTOR INSURANCE CLAIMS AT SYARIKAT TAKAFUL MALAYSIA BERHAD.
In e-PROCEEDINGS (p. 121).
Mohleji, S. and Pielke Jr, R., 2014. Reconciliation of trends in global and regional economic losses from
weather events: 1980–2008. Natural Hazards Review, 15(4), p.04014009.
Muhamat, A.A., Jaafar, M.N. and Alwi, S.F.S., 2017. General Takaful claims: An experience of Takaful
operator in Malaysia. Journal of Emerging Economies & Islamic Research, 5.
Pugely, A.J., Martin, C.T., Harwood, J., Ong, K.L., Bozic, K.J. and Callaghan, J.J., 2015. Database and
Registry Research in Orthopaedic Surgery: Part I Claims-Based Data. JBJS, 97(15), pp.1278-1287.
Wüthrich, M.V. and Merz, M., 2013. Financial modeling, actuarial valuation and solvency in insurance.
New York: Springer.
Yunos, Z.M., Ali, A., Shamsyuddin, S.M., Ismail, N. and Sallehuddin, R.S., 2016. Predictive Modelling for
Motor Insurance Claims Using Artificial Neural Networks. International Journal of Advances in Soft
Computing and its Applications, 8(3), pp.160-172.
Yunos, Z.M., Shamsuddin, S.M., Alwee, R., Ismail, N. and Salleh, R., 2016. Comparative performance for
predictive modelling in motor insurance claims. Jurnal Teknologi, 78(12-2).
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Zulkifli, M., Razali, A.M., Masseran, N. and Ismail, N., 2015. Statistical analysis of vehicle theft crime in
peninsular Malaysia using negative binomial regression model. Sains Malaysiana, 44(9), pp.1363-1370.
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Glossary of key words
Analyse
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various facts and make conclusions or recommendations.
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Describe
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qualities or events.
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Identify
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Outline
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Recommend with reasons
Provide reasons in favour.
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