Great people and great companies use adverse times to their advantage

(Message of the Managing Director to the delegates of the 4th Annual Sales Conference 2009, speaks his thoughts for 2009 and is therefore reproduced below.)

Dear Colleagues,

Assalam-o-Alaikum and a very hearty welcome all of you to the 4th NJI Sales Conference - 2009.

There is so much negativity flying around these days that it requires super-human effort not to be effected by it … but then throughout history great people and great companies have used adverse times to their advantage to improve, to innovate, to grow and to establish themselves as outstanding.

My message, therefore, to you is not to buy into the negativity and remain positive. We will take this opportunity in adversity to improve and modernise NJI, we will innovate and explore new frontiers to grow profitably and in the process cement our role as the best insurer of the country.

The “business not as usual” means that in order to succeed we will have to raise our productivity dramatically, will have to curtail our expenses in this era of high inflation and achieve and grow more with less. These seemingly tough goals are eminently achievable by lending support to each other more than ever. Let this be our new year resolution for 2009 and I am sure that we will come out stronger and we will make NJI proud.

I invite you to delve deep into the theme of this Conference and take away the thoughts and strategies to succeed and achieve the target of 25% profitable growth reaching Rs.4.25 billion by 31st December 2009 … InshaAllah.

I wish all of you success, always.

With warm regards,

Tahir Ahmed
Managing Director

4th Annual NJI Sales Conference : Exploring New Frontiers

NJI’s Fourth Annual Sales Conference was held at Regent Plaza, Karachi on 26-27 January 2009, with the theme Exploring New Frontiers.

The Managing Director Mr Tahir Ahmed’s message befitted the theme and appears on Page 3.

The conference commenced with an inspirational video “212 The Extra degree” demonstrating that just as at 211 degree water boils, and at 212 degree boiling water becomes steam which can power a locomotive, an extra degree of effort in business and life can simply make good to great, urging the viewers to turn up the heat and develop the 212 attitude.

In spirit of Exploring New frontiers, our young SM-Operations Umair Ismail introduced a new activity in shape of ‘Case Study’, providing delegates an opportunity for interactive learning and analysing. The case study was on marketing Extended Warranty Insurance for a new light truck in rural and urban markets. 13 teams competed to come up with the best marketing strategy, pricing and scope of cover, and the winners were the Green Team (photo on page 14).

2-day Conference was interestingly compered by SM Dr Fauzia Ghayas Siddiqi and DM Maria Minhas. The speakers, one and all, did justice to their given topics: JEVP Uzair Mirza spoke on Non-Traditional Products & Distribution Channels; Advisor Mirza Ali Mahmood on Alternate Energy; JEVPs Mohammad Safdar and Brendan D’Lima on Terrorism Insurance: Insuring with Certainty; JEVP M Afzaluddin and SVP Nadeem Irshad on Health Insurance: Beyond Corporates and Enterprises; JEVP S Ather Abbas and JSVP Shehnaz Kassim on Sales Strategy: Diversification is the key; JEVP Sohail Ahmed and SVP Zahoor Shaheen on Cross Selling is the Name of the Game; JEVP Azfar Arshad and SVP Mahboob Pervez on Underwriting for Profitability: Walking a Tight Rope; JEVP Imran Rabbani and JSVP Ali Asim on Claims Trendlines; SVP Karim Merchant and JSVP Mian Allah Nawaz on Risk Management: Effective tool for Value Addition; JEVP Mohammad Ikram and SVP Ch Sardar Ali on Zone Strategy; ED-Finance Atiq Mahmudi on Impact of Global Economic Recession, JEVP Nawaid Jamal on Managing Expenses and ED-Operations Abdur Rahim on 2009 & Beyond.

Both days had a guest speaker. Syed Zeeshan Arshad, Senior Faculty Member of SZABIST addressed us on Emerging Technology Challenges, talking about waves in technology advancement, new type and nature of jobs that technology will create in future, and suggested that corporate customers should go for ‘mature’ technology rather than invest in latest untested ones.
Mr Qashif Effendi, Executive Director Marketing & Communications, KESC talked about Understanding Consumer Logic in a very engaging manner as marketing professionals are known to do. His take-home message was to treat the consumer with ‘you attitude’ and when selling talk/think about benefits a product will have for the consumer.

Achievements of marketing officers of the company were recognized with 3 categories of awards: Top Star, Rising Star and Star Collect. There were also awards for the Top Five Branches in the company.

As always a good balance of work and play was achieved with opening dinner and a picnic which had many up on their feet and dancing to the rhythm of local music.

Many persons worked to make the conference a success: The entire administration department arranging tickets, transport, hotel booking, entertainment, food, personal attention to visitors from outstation offices; operations department actively framing the programme and selecting the guest speakers; heads of departments and branches delivering presentations in their area of expertise.

We are confident that the highly interactive Conference will gear the NJI team to the challenges of 2009.

Revised Institute Cargo Clauses 1/1/09

The Joint Cargo Committee of International Underwriting Association of London (IUA) and Lloyd’s Market Association (LMA) have issued the revised version of Institute Cargo Clauses A, B, C, Institute Cargo Clauses (Air) and their accompanying War and Strikes Clauses. These Clauses are dated 1/1/09 and replace the previous Clauses which were in use since 1/1/1982.

On the whole the revision has not brought any basic changes in the coverage, exclusions and other terms and conditions. The Clauses were actually updated and appropriately worded with some additions / alterations to meet the insured’s needs in a more effective way. The revision has brought more clarity to the Clauses and the policy-holders are now in a better position to understand what is provided and excluded therein. The effects of the revision are summarised below.
1 The duration of insurance has slightly increased. The cover is now operative from the time the cargo is “first moved” in the warehouse for “immediate loading” on the carrying vehicle for the commencement of transit. Under the previous Clause the insurance attaches from the time the goods “leave” the warehouse or place of storage at the place named in the contract of insurance.
2 The termination of insurance is now linked with the “completion of unloading” from the carrying vehicle subject to other conditions as specified in the “Transit Clause” instead of “on delivery” to the warehouse or place of storage as mentioned in the previous Clause.
Furthermore, under the revised Clause the insurance also terminates where the insured or their employees elect to use the carrying vehicle or any other conveyance for storage other than in the ordinary course of transit
3 The exclusion concerning insolvency or financial default of the owners, managers, charterers or operators of the vessel is now applicable where the Insured are aware or in the ordinary course of business should be aware of such insolvency or financial default at the time of loading of the cargo on board the vessel. Under the previous Clause this was an absolute exclusion.
4 In ICC A, B, C and their accompanying War & Strikes Clauses the exclusion unseaworthiness / unfitness of the vessel or craft is now applicable where the assured are privy to such unseaworthiness / unfitness at the time of loading of the cargo therein. Under the previous Clause this exclusion was applicable if the assured or their servants were privy to such unseaworthiness / unfitness at the time of loading.
5 Under the revised “Change of Voyage Clause” a new sub-clause 10.2 has been added to protect the insured’s interests where after attachment of insurance, the ship sails for another destination without the knowledge of the assured or their employees. Under such circumstances the cover will remain operative.
6 Under the revised “Change of Voyage” Clause the Insurer’s interests are also protected where, after attachment of insurance, the destination is changed by the Insured and a loss occurs prior to Insurer’s agreement to extend the cover up to the changed destination.
7 The revised Clauses protect the interests of innocent assignees of insurance who have bought or agreed to buy the goods in good faith under a binding contract.
8 The revised Strikes Clause 1.2 covers loss or damage caused by any “act of terrorism” which is precisely defined therein. Under the previous Clause the word “terrorism” was undefined. The revised Clause 1.3 covers loss or damage caused by “any person acting from a political ideological or religious motive”, which was restricted to “political motive” in the previous Clause. The terminology “political motive” can be interpreted in a wider sense and it can embrace the activities carried out with ideological or religious motive. As such the revision has not extended the scope of this Clause. It has actually elaborated the extent of the cover provided therein.
The aforesaid sub-clauses 1.2 & 1.3 come within the exclusions of ICC “A”, “B”, “C” & Cargo Clauses (Air).
9 In ICC A, B, C and their accompanying War Clauses there are no alterations in the risks covered.
10 In Institute Cargo Clauses (Air) and their accompanying War & Strikes Clauses a new and important Clause “Salvage Charges” has been added, which reads as follows:-

The above-mentioned revision is another step towards refinement of marine clauses and it is hoped that these clauses will be widely used in Pakistan soon.

NJI’s 100% Insurance Cover against Terrorism

Terrorism is the use of fear and violence as a tool of propagating civil unrest and social paranoia. The main factor contributing to terrorism in Pakistan is violence as a result of political rivalry, sectarian, religious & ideological issues. Incidents of terrorism in Pakistan have increased many folds during the last decade.

In 2008, a number of terrorist attacks were experienced across the country. In Islamabad, four suicide bombers struck targets like the Danish embassy, Marriot Hotel, Police lines and Melody Market. Two suicide bombers blew themselves up at the gates of the Pakistan Ordnance Factories in the high-security cantonment town of Wah, around 30 kilometers from Islamabad, killing 70 persons in what was described as the deadliest attack on a military installation in the country’s history.

In March, eight persons were killed and 24 others sustained injuries when two suicide bombers blew themselves up in the parking area of the Pakistan Navy War College in Lahore.

The human bombs struck 20 times in the first 100 days of 2009 in various parts of Pakistan and killed at least 100 people a month on average. Around 332 civilians were killed. People who received injuries due to suicide attacks in the first 100 days of 2009 were around 421, most of whom were civilians. Safety has become a major concern, not just for businesses and government institutions but also for individuals all over Pakistan.

All these statistics do not take into account the accompanying loss of property and damages, survivors of these attacks have to endure. In reality the repercussions of these disasters are immeasurable. One suspects that just like 27/12 most of the affectees of terrorism, have either not purchased terrorism cover at all, or have opted for a very limited indemnity level. This is due to a variety of reasons which include scarcity and a perception that it is very expensive, with the unfortunate repercussion that the cover appears very cheap after the event.
The increased occurrences of such events have made it mandatory for people to take protective measures against such mishaps. Be it businesses or households; security measures must be taken, like appointing security guards for example. Metal and explosive detectors could be installed in buildings, so as to reduce the risk of suicide bombers entering the premises. Everyone needs to be vigilant of suspicious people and activities in their surroundings and wherever necessary immediate action must be taken to prevent a possible terrorist incident.

These precautions can reduce the chances of loss due to terrorism. However there is always the probability of an incident occurring despite the most stringent security measures. In such an unfortunate event where such mishaps are experienced, insurance is a tool which can provide a cushion against the financial impact of the loss. Securing ones self against terrorism might be the smartest thing to do in the current scenario. Taking protective measures towards ones business, property and belongings is critical.

Terrorism insurance has gained tremendous importance over the years, especially after the 9/11 incident. Before the destruction of the Twin Towers, terrorism insurance was widely available at nominal premium rates. No one thought twice about providing coverage. However the availability of terrorism insurance diminished with the collapse of the towers on that fateful day. The insured financial loss resulting from the terrorist incident is estimated at USD 32.5 billion. This single loss had a far-reaching effect on the insurance and re-insurance sector and the capacity for underwriting terrorism risk all but disappeared. The major players adopted the wait and see approach till they had enough data to predict the trend of losses due to terrorism. During this period from 2001 up till 2008, most insurance companies offered only very limited coverage for terrorism based on the capacity of each company without any substantial reinsurance support.

Beginning in early 2008 with rising demand for terrorism coverage in Pakistan, certain leading insurers in Pakistan have been able to enter into arrangements with international reinsurers. These arrangements enable the insurers to provide sufficient capacity to meet the requirements of the larger business houses and multinational organizations in Pakistan. Although the coverage is still rather expensive in comparison to the standard Fire and Allied Perils coverage for Property, it must be evaluated in view of the rising frequency of terrorism incidents and the widening scope of the possible targets.

New Jubilee Insurance Company Limited is one of the few companies in Pakistan offering 100% insurance on full property value. In the current turbulent times, terrorism insurance is perhaps the best protection that property owners can obtain to protect their assets against this rising peril. Some are even tempted to say that at present terrorism insurance is more important than the conventional property insurance covering fire and allied perils.

Sources:
• Research paper by Analysis Group-Economic
Financial and Strategy Consultants
• South Asia Terrorism Portal
• The News - April 2009

Haji Muhammad Ramzan Senior Vice President Lahore Sales Unit III

Tell us something about your early life and first 3-4 years of work life.
I did my graduation, and in 1967 secured a job in Batala Engineering. Then two years later, I moved to Pakistan Guarantee Insurance. In 1971 I was walking on Mall Road and saw the signboard of New Jubilee Insurance and took the initiative to go there and was appointed on cash-and-carry basis, but on 7th April 1973 I secured a permanent job with NJI.

You have worked with NJI for over 35 years. What is the most memorable event in your career?
The event is remembered because it was frightening! One afternoon in 1996 two policemen, a DSP and a social security official walked into my office and showed me an insurance guarantee that we had provided a client, and demanded payment of rupees one lac on the spot or face arrest. First I had to calm them to make some sense out of the situation. On gathering the necessary information, I consulted Lahore Zonal Office who advised that I should get a letter from them making a claim against the guarantee. To expect this from government officials, who are used to getting all they ask for, would be a feat! I used reason, failing which used a trick to let me go to LZO to fetch the cheque. Having escaped, I let LZO communicate with the head office which went on late into the night. Finally a cheque was given to the claimants, but as far as I was concerned, I promised never to write another insurance guarantee!

What was the most difficult situation that you had to deal with in your work life?
In mid-80s one of my major clients, Punjab Group of Industries, had a serious set-back when import of steel was temporarily closed. My marine insurance business dropped considerably and Mr Noorani, the then MD, questioned my performance. I left the decision about my job in his hands but thankfully Punjab Group set up an oil mill and their marine business bounced back to the satisfaction of management.

Is insurance business done in the same way as in the past or there is a change.
There is a lot of change. Pakistani businessmen’s children today are well educated and they do insurance based on knowledge of the subject unlike their parents who did it purely on relationship. Today’s businessmen are only convinced with proper information, more so in these uncertain times they want to truly feel secure, whereas in the past it was alright even if the business was not insured.

What change will make insurance business better? Give us your suggestions.
Insurance business will become better when our sales agents are educated, honest and realise that giving quality service to clients is vital rather than just keeping their eyes focused on commission they can earn by procuring an insurance. Claims payment is the test of insurance as we all know. At that critical time, agent is required to guide and swiftly interact with the client and his company for fair and speedy settlement. Pace of life has become faster and incompetence of sales agent can shake confidence of clients in insurance in general and about the company they deal with, in particular.

Apart from your work life what are your other interests.
I am entirely committed to insurance and have been available to my clients whatever the time of day. Over the years this has not left me time for anything else. On the spiritual side, I perform Umrah every year and that is my other interest apart from insurance.

What in your opinion is the future of insurance in Pakistan?
It is good because more businessmen are educated and understand the value of insurance. As you know in Europe and in other developed countries, insurance has flourished. In Pakistan too the volume of insurance will definitely increase in future.

Learning Culture

NJI Certificate in Insurance

Level I
Second batch of NJI officers, comprising mostly newly appointed, commenced in-house classes for basics of insurance, in early March. 34 participants, including from Lahore through video-conferencing, will have weekly classes leading to optional written test in May to test their learning and move to Level II.

Level III
17 offcers from Karachi and 7 from Lahore qualified for Level III classes, having scored above 55% in their Level II exam held in November 2008. Their classes run parallel to above ones for Level I. In May they too will have written test and successful participants will be awarded certificates.

External Training
Our Officers gained learning on:
• Anti-Terrorism & Disaster Management
• Vision 2050
• Developing a Successful Business Plan
• Crop Loan Insurance Scheme in Pakistan
• Mobile Commerce Conference
• IAP’s Claims Management System
• Branch Banking: Opening and Operations of Accounts
• Mid-year Review of the Economy

from sessions conducted by reputed training institutes.

Management is the Name of the Game

“I believe that I was deeply influenced by the Chinese policy in terms of management, because I spent a considerable amount of time working over there, particularly in Hong Kong. The time value for money concept I learnt there is amazing. They seem to have internal motivation to work and do not require external motivating factors at all.

“Unfortunately, Pakistanis feel motivated by external factors and we do not try to create internal motivation, such as the motivation to succeed, the motivation to do something, the motivation to be patriotic and the motivation to be proud of what you are. We spend most of our time criticising others, and being concerned about what others have to say about us, and this tendency drops the efficiency level. I believe we should try to incorporate that change here.

“How did all the developed countries make it to the top, especially the new ones, including Singapore, Malaysia, Indonesia, Thailand and Hong Kong?. They were not gifted with any significant resources, they did not have the endowment of natural resources, then what gave them the position that they have today in the world? They have management skills. They know that they can purchase something, improve it and make it better and then sell it, this is their capability. And I believe that management is the name of the game. If you have the ability to harness people then you have power, and if you cannot harness them, you are in disarray. Disarray means there is disturbance in the society. A country (China) that has population of 1 billion has managed the task of keeping the people together and at the same time keeping track of their progress and development.”

Excerpt from interview of Mr Sirajuddin Aziz, CEO, Bank AlFalah Limited in Boss magazine.

Stress Management

Globally there are reasons to feel more stress than before but individuals respond to stress in different ways, so maybe you’d like to start by finding your resilience to stress by choosing an answer below:

A You generally feel insecure
B You generally feel sad
C You are generally a happy person
D You are a self-focused person

If you chose “D” you have bad news! Self-focused or egocentric people take things personally and the extent to which you take things personally will affect the level of stress you feel. The person who has the capacity to say, “This is not directed personally at me” has much better chance of remaining resilient to stress. It is the meaning we put into events that protect our resilience and help us cope and adapt.

What is resilience?
It is more than positive thinking or finding the silver lining in clouds, and denial is only a defense mechanism. Resilient people do not pretend that everything is all right, but take the initiative to do what they can to help themselves and others. They create a new meaning from the experience, making a mental shift that allows them to see themselves not as victims but as survivors. They go on with their lives and live more purposefully.

Who is more resilient to stress?
A Those who do not get stressed when times are bad
B Those who are trained in stress-management techniques
C Those who seek help from reliable people in times of stress
D Those who make concrete plans to handle traumatic events

Here, the correct answer is “C”. Resilient people recognise that bad things happen to good people, so they are not overwhelmed by stress when they experience setbacks. They also have confidence in their ability to deal with bad situations as well as have bonds with responsible, helpful adults with whose support they withstand pain and disappointment: The ability to draw strength from relationships is one aspect of resilience.

In fact, there are seven strengths that together make up resilience:

1. Independence: Keeping emotional and physical distance from source of trauma
2. Relationships: The ability to attract, connect with, and form meaningful attachment to others
3. Insight: Asking yourself hard questions – about your strengths and weaknesses - and give yourself honest answers
4. Initiative: Taking charge of your problems
5. Morality/spirituality: A firm sense of value and one’s own self-worth
6. Creativity: giving meaning to your troubling experience and painful feeling
7. Humour: finding the comic in the tragic

(Source: Newsweek magazine)

NJI Sponsors Two National Snooker Championships

Under21 Championship
22-27 February 2009

“Cream of country’s youth will be featured in the NJI sponsored 7th National Junior Under-21 Snooker Championship which kicks-off at Karachi Club on 22nd February 2009,” said the daily DAWN.

Thirty-two cueists representing the four provinces participated in the 5 day event. “Asad Iqbal of Punjab on his debut beat province-mate Hamza Akber 4-2 in the finals, receiving Rs 40K cash prize from our ED-Finance Mr Atiq A Mahmudi, and Hamza was awarded Rs 25 K.

Our Managing Director, Mr Tahir Ahmed, said there is “no better way to invest in the youth of the nation than supporting a sporting event in which they participate.” He also paid tribute to the president and past-president of Pakistan Billiard-Snooker Association for their dedication and commitment to the promotion of the sport.

National Snooker Championship
16-21 March 2009

NJI sponsored 34th National Champoinship 2009, presenting a purse of Rs 40,000 to the winner and Rs 30,000 to the runner-up.

A new champion Mohammad Asif emerged this year, dethroning the holder Mohammad Sajjad 6-2 in the finals held at Karachi Gymkhana.

The News reports that, “The flurry of upsets on the six days of action threw the top cueists of the country out of contention and Sajjad turned out to be the last casualty.”

My Life with NJI

I often reminisce about my life and take stock of the achievements, blessings and disappointments. Reaching close to half a century of working life is an event that triggers off an intense train of thought I would like to share this.

I joined NJI as a young man of twenty four on starting my working life almost 50 years ago this day today the 10th APRI. The years have flown by; time has depleted but I have gained an asset which is worth its weight in gold- the trust and confidence of my Company, management and colleagues.

I am thankful to Allah, who gave me strength and health to develop my skills and rise in the Company. I have worked hard and trid to set high standards of honesty, hard work and dedication through example and not just empty lip talk.

During the half century or so that I have been with the company, I have been fortunate to work with all the former Chief Executive/Managing Directors including Mr. S. C. Subjally, Mr. M. Y. Farooqi (late), Mr. Masood Noorani and currently for the past four years with Mr. Tahir Ahmed. Working with professionals has been challenging but rewarding.

I offer my heartiest thanks to all of my colleagues, associates and friends with whom I have spent these happy and satisfying years. For all those who have worked for me and those that I have worked for during the entire period of these past forty nine years. The love, affection and loyalty extended to me will never be forgotten and I pray to Almighty Allah to bless them upon with happy and better future.

HASHIM MOHAMMED SHAMIM
ADVISOR,ADMINISTRATION

Table Tennis

NJI team participated in 1st KESC Inter-firm & Karachi-ranking Table Tennis Tournament which was held from 24-30 March 2009 at the Islamia Club.

Tournament was played in two-category team events and men’s single ranking, and the results were:
• NJI beat Pakistan Petroleum Limited 3-2, and lost against GlaxoSmithKline who were the champions of the Tournament
• However, AM-Saddar Branch Farrukh Kamal won the first set against Asim Kamal who is national-ranking player
• In the second event, Men’s Single, Farrukh Kamal qualified for pre-quarter-final and got the 9th ranking out of 124 players.

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Pictures below: Top one shows the Green Group who were the winners of Case Study exercise, and the one below are the organisers who made the Sales Conference a success.

Lighter side of the Conference