OBJECTIVE OF THE STUDYThe phenomenal expansion of insurance

sector:
The major insurance companies in our country have expanded their
branches phenomally in the last few decades. Also, many
newinsurance companies are being established all over the
country.The objective of the study is therefore, to examine the
insurance companies, their functioningand asses their viability.

Importance of the study

The need to make profits:
Profits are essential for the survival and growth of everycommercial
organization.
Increasing emphasis on profitability:
The profitability aspect of the insurance companies hasgotten a lot of
attention in the recent years.
Employee satisfaction:
Along with the increasing emphasis on profitability,
employeesatisfaction has also been generating considerable
interest.This study has thus been undertaken to examine the
importance human resource management ininsurance companies.

INTRODUCTION
Competitive advantage of a company can be generated from human
resources (HR) andcompany performance is influenced by a set of
effective HRM practices. In this study, weintended to assess the HR
practices in insurance companiesEvery organization is composed of
people and utilizing their services, developing their skills,motivating
them to enhance their levels of performance and ensuring that they
remain committedto the organization are essential for the
accomplishment of organizational objectives. This is truefor all types
of organizations - government, business, education, health, recreation
or socialaction. Organizations that can do this will be both effective as

well as efficient. Inefficient or ineffective organizations face the

danger of stagnating or going out of business.The emphasis on proper
and effective human resource management has increased in the recent
times. It has come to be identified as an important factor in the
successful management of anorganization. With the growing
importance of knowledge workers to organizations and the
risingexpectations of employees, it is essential to have a good human
resource management system in place.
Human Resource Management
(HRM) consists essentially of four functions acquiring,developing,
motivating and retaining human resources. The acquisition function
starts with planning for the number and categories of employees
required, and end with staffing. Thedevelopment function has three
dimensions employee training, management development,
andcareer development.The motivation function includes identifying
the individual motivational needs of employees andfinding ways to
motivate them. The retention function is concerned with providing a
work environment conducive to the employees and nurturing them to
make them feel committed andattached to the organization.Human
resources are the most valuable and unique assets of an organization.
The successfulmanagement of an organization's human resources is an
exciting, dynamic and challenging task,especially at a time when the
world has become a global village and economies are in a state
of flux. The scarcity of talented resources and the growing
expectations of the modern day worker have further increased the
complexity of the human resource function. Even
though specifichuman resource functions/activities are the
responsibility of the human resource department, theactual
management of human resources is the responsibility of all the
managers in anorganization.It is therefore necessary for all managers
to understand and give due importance to the differenthuman resource
policies and activities in the organization.Human Resource
Management outlines the importance of HRM and its different
functions in anorganization.It examines the various HR processes that
are concerned with attracting, managing, motivatingand developing
employees for the benefit of the organization.

The insurance sector employers are indulging into aggressive

recruitments. With around 15million new policies being sold every
year, the insurance sector is picking up fast in India. Dueto its robust
growth there is a need of skilled professionals in the sector. The
employers arelooking forward to hire freshers at junior levels as they
are quite flexible and ready to work as part time employees as well.
Apart from hiring actuaries and underwriters, the industry isfocusing
on hiring agents. These agents represent the front end of the customer
chain and areresponsible for bringing in new business

INSURANCE SECTOR: AN INTROSUCTIONInsurance

is a form of risk management primarily used tohedgeagainst therisk of
a contingentloss.Insurance is defined as the equitable transfer of
the risk of a loss, from one entity to another, inexchange for
a premium, and can be thought of as a guaranteed and known small
loss to preventa large, possibly devastating loss.An
insurer
is a company selling the insurance; an
insured
or
policyholder
is the person or entity buying the insurance.The
insurance rate
is a factor used to determine the amount to be charged for a certain
amountof insurance coverage, called the
premium
.The
six principles
of insurance
are:
1.
Indemnity

 Insurance is a contract of indemnity where the insurance

companyindemnifies the insured against certain risks for a
consideration known as premium.
2.
Insurable interest
means the loss of which will directly affect the insured.
3.
Utmost good faith
means that the insured and the insurance company will not
willfullyhide anything from each other.

4.
Mitigation
means the insured will not behave irresponsibly and will take due
care sothat the risk of loss or the loss is minimized.
5.
Subrogation
means the insurance company acquires legal rights to act on behalf
of theinsured i.e. the insurance company steps into the shoes of the
insured.
6.
Causa Proxima or Proximate Cause
means the proximate cause of loss to ascertainwhether the loss is
covered under the policy.
HISTORY OF INSURANCE SECTOR IN INDIA
The history of Insurance in India started with life
insurance in 1818 when it wasconceived as a means to
provide for English Widows. Interestingly in those days
a higher premium was charged for Indian lives than the non-Indian
lives as Indian lives were consideredmore risky for the coverage.The
Bombay Mutual Life Insurance Society started its business in
1870. It was the firstcompany to charge same premium for both
Indian and non-Indian lives. The Oriental AssuranceCompany was
established in 1880. The General Insurance Business in India, on the
other hand,can trace its roots to the Triton (Tital) Insurance
Company Limited, the first general insurancecompany

established in the year 1850 in Calcutta by the British.

Till the end of nineteenth century insurance business was almost
entirely in the hands of overseas companies.Insurance regula tion
formally began in India with the passing of the Life
Insurance Companies Act of 1912 and the provident fund Act
of 1912. Several frauds during 1920's and1930's sullied insurance
business in India.By 1938 there were 176 insurance companies.
The first comprehensive legislation wasintroduced with the
Insurance Act of 1938 that provided strict State Control over
insurance business. The insurance business grew at a faster
pace after independence. Indian companiesstrengthened their
hold on this business but despite the growth that was
witnessed, insuranceremained an urban phenomenon.
INSURANCE JOB DESCRIPTION
The insurance job description which is generally assigned to people
working in the insuranceindustry is given below:

To handle all the affairs of the customer related to the policies

or theservices offered by the insurance company and to resolve
any conflictsarising if any.

To work for insurance company or several insurance companies and

finding clients inorder to create awareness about the insurance
policies that the insurance company has tooffer.

The job responsibility may include finding out if the claim made by
the client for insurance cover warrantees insurance or not.

To investigate whether all the premiums were paid on time and

whether the claim madefalls in the particular insurance policy.

To meet potential customers and sell them the insurance policies

being offered by theinsurance company.
Competencies required for job in insurance
Any Insurance job seeker must possess the following set of skills:

Public Speaking
: A good insurance professional should have strong communication
aswell as public speaking skills.

Computer knowledge
: Basic knowledge of computers including Microsoft
Word,WordPerfect, Outlook, Excel, PowerPoint, Tally etc would
prove to be an asset.

People skills:
An Insurance professional should be able to communicate as well
asinteract with other working professional including colleagues as
well as clients of thecompany.

Organisational skills
: As an insurance job includes organizing work it is necessary tohave
good skills in this department

To link human resource strategies / policies to the business goals and

objectives;

To find ways for human resources to "add value" to a business;

To help a business gain the commitment of employees to its values,

goals and objectives
OBJECTIVES OF HRM
1.
SOCIETALTo be ethically and socially responsible to the needs and challenges of
thesociety.2.
ORGANIZATIONAL
-To bring organizational effectiveness and serve other departments.3.
FUNCTIONALTo do the optimal utilization of the resources and respond to the need
of the organization.4.

PERSONAL
-To assist employees in achieving their personal goals to motivate and
retainthem thereby, enhancing the individuals contribution to the
organization.
DEFINITION OF HRD
HRD DEALS WITH DEVLOPMENT & UPGRADATION OF
HUMAN CAPITAL(EXSISTING MAN POWERS
UPGRADATION IN AN ORGANISATION).IT IS A LONGTERM
PROCESS.HRD can be defined as A
Set of systematic and planned activities designed by anorganization, to
provide its members with the necessary skills to meet current and
future job demands.
It is a part of HRM.
Thus,
Human Resource Development deals with the training and the
developmental aspect of employees.
HRM IN INSURANCE
Under present market forces and strict competition, the insurance
companies are forced to becompetitive. Contemporary companies
must seek ways to become more efficient, productive,flexible and
innovative, under constant pressure to improve results.The traditional
ways of gaining competitive advantage have to be supplemented
withorganizational capability i. e. the firms ability to manage
people.Organizational capability relates to hiring and retaining
competent employees and developingcompetencies through effective
human resource management practices.Indeed, developing a
talented workforce is essential to sustainable competitive
advantage.High performance work practices provide a number of
important sources of enhancedorganizational performance. HR
systems have important, practical impacts on the survival andfinancial
performance of firms, and on the productivity and quality of work life
of the people inthem.
Objectives and Importance of the Study
Liberalization in the Indian insurance sector has opened the sector to
private competition.The insurance industry forms an integral part of
the global financial market, with insurancecompanies being

significant institutional investors.In recent decades, the insurance

sector, like other financial services, has grown in
economicimportance.A number of foreign insurance companies have
set up representative offices in India and havealso tied up with various
asset management companies.
All these developments have forced the insurance companies to be
competitive.What makes a firm best is not just technology, bright
ideas, masterly strategy or the use of tools, but also the fact that the
best firms are better organized to meet the needs of their people,
toattract better people who are more motivated to do a superior job.In
this manner the management of human resources becomes very
crucial.Thus, this study on HRM practices in insurance
companies was taken up.