FinancialMarketsAndInstitutions topic non lifeinsurancecompanies

Life msurance focuses on protecting human health and life, while non-life insurance includes products that protect property, liability, marine, aviation and many other fields.. PJICO wit

Pham Gia Han_

Pham Tuong Vy_

Nguyễn Tiến Phát _-

Không Vũ Minh Thái _

1.1 History and background

1.1.1 History of Petrolimex Insurance

1.1.2 Legal structure and ownership

1.2 Business model and operations:

1.2.1 Business model:

1.3 Financial performance:

CHAPTER 2: Products and services offered:

2.1 Motor vehicle insurance:

2.1.1 Value-added service:

2.1.3 Passenger Cover in Car Insurance

2.1.4 Material insurance

2.2 Health insurance

2.2.1 Health insurance for individuals

2.2.2 Health insurance for employees:

2.3 Technical insurance

2.3.1 Machinery breakdown insurance

2.3.3 Completed civil works insurance

2.4 Insurance assets

2.4.1 Compulsory Fire and Explosion Insurance

3.3 How does the financial institution target and reach its target market? -«-c «+ 2+2

CHAPTER 4: Strengths, weaknesses, opportunities, and threats (SWOT) analysÏs c cà co cà,

CHAPTER 5: Recommendations for the future

INTRODUCTION Insurance is an important financial services industry, serving as an effective risk management tool for individuals, businesses and society as a whole In a modem economy with many risks and fluctuations, insurance has become an indispensable element to protect property, health and human life The insurance industry includes two main areas: life msurance and non-life insurance Life msurance focuses on protecting human health and life, while non-life insurance includes products that protect property, liability, marine, aviation and many other fields Non-life imsurance provides comprehensive protection solutions, helping businesses and mdividuals minimize risks, stabilize business operations and protect assets

PETROLIMEX Insurance Corporation (PJICO) is one of the leading enterprises in the field of non-life insurance in Vietnam With a history of more than 60 years of establishment and development, PJICO has affirmed its solid position in the domestic insurance market

In the context of increasingly deep economic integration, PJICO continues to innovate and develop to become one of the leading insurance groups in the region, worthy of the trust of domestic and foreign customers PJICO with a variety of products such as property insurance, liability surance, marine insurance, aviation insurance and many other fields, non-life insurance meets the increasingly diverse needs of customers With the motto "Dedication - Professionalism - Efficiency", PJICO always strives to provide customers with high-quality insurance solutions, meeting the maximum protection needs of businesses and individuals.This industry is growing strongly globally

as well as in Vietnam

In addition to professional human resources and strong financial capacity, PJICO also owns a wide network of branches and representative offices nationwide, ensuring the ability to reach and serve customers conveniently best With that advantage, PJICO has been affirming its leading position in Vietnam's non-life insurance industry

CHAPTER 1: Overview of the financial institution

1.1 History and background

1.1.1 History of Petrolimex Insurance

Petrolimex Insurance is the first insurance joint stock corporation established in Vietnam in 1995 according to the State's economic development innovation policy, gathering the economic strength and prestige of corporations large state-owned company,

in which the dominant founding shareholder is Vietnam Petroleum Group - Petrolimex and other founding shareholders are Vietnam Steel Corporation, Bank for Foreign Trade

of Vietnam - Vietcombank , Electronics Company Hanoi, Complete Equipment Import- Export Company, Vietnam National Reimsurance Company, Vietnam Railway Union Trade Union, Petrolimex Insurance Joint Stock Company (PJICO) have developed rapidly in all aspects and is considered one of the insurance companies with top service quality in the Vietnamese insurance market

After more than 26 years of operation, with the motto of providing door-to-door service and meeting insurance needs on the spot, Petrolimex Insurance has built a team of over 1,800 dynamic employees with basic training with good professional qualifications working in Hanoi and 61 branches and representative offices in provinces and cities from North to South and more than 4,500 insurance agents and collaborators nationwide PJICO Insurance has quickly widely deployed nearly 80 types of insurance in the fields

of construction, installation, fire property, marine, people, motor vehicles, and professional liability to tens of thousands of subjects domestic and foreign customers The company has risen to a leading position in a number of insurance fields such

as construction insurance for cement factories, transportation works (bridges, roads), energy works (hydropower, thermal power), industrial, petroleum, civil At the same time, many large projects and services of national stature are also insured at Petrolimex Insurance such as: the majority of large oil tanker fleets of Vietnamese shipping lines, VOSCO, Vinalines, and Thuy I fleets; National highways, large bridges such as Thanh Tri, Bai Chay, Phu Luong, Cam Pha, Ham Rong, Duong Bridge, Vinh Tuy, railway bridges, hydroelectric and thermal power plants such as Song Hinh, Dai Ninh, Se San 3,

4, Pleikrong, Quang Tn, Tuyen Quang, Cao Ngan; Dong Nai 3, 4, Quan Ninh, Cam Pha power transmission lines Ham Thuan-Dami, 500K V Ha Tinh-Thuong Tin; The largest cement factories in Vietnam have been deployed such as But Son, Hoang Mai, Tam Diep, Hai Phong, Song Thao high-rise buildings and large hotels in Hanoi and City HCM such as Pacifc Place, Hanoi Daewoo, Vietcombank Tower, HITC, Sheraton Hanoi Hotel, Hanoi Melia, Saigon Diamond Plaza, Saigon City View .; system of warehouses, gas stations throughout the country and a large number of passengers of Vietnam Railways ; Professional liability insurance for a number of large consulting companies such as

Power Construction Consulting Company 1, Power Construction Consulting Company 4, Vietnam Construction Consulting Corporation, TEDI

The process of formation and development

Nam 2010 @

Quá trình hình thành và phát triển của bảo hiém PJICO

1.1.2 Legal structure and ownership

Petrolimex Insurance Joint Stock Company (PJICO) is a state-owned insurance company in Vietnam, participating in the non-life insurance market The company's shares are not currently listed on the Ho Chi Minh City Stock Exchange and are majority owned by Petrolimex (51%), a state-owned petroleum company PJICO 1s the fourth largest insurance provider in Vietnam and the third largest non-life insurance company Petrolimex Insurance Joint Stock Company has 07 founding shareholders By 2013,

it was transformed mto Petrolimex Insurance Jomt Stock Corporation according to adjustment license No 67GPDCO1/KDBH dated March 25, 2013 of the Ministry of Finance

Tên tiếng Việt TONG CONG TY C6 PHAN BAO HIEM PETROLIMEX

Tén tiéng Anh Petrolimex Insurance Corporation

Tén giao dich Tổng Công ty Bảo hiểm P.JICO

Ngày thành lập 15 tháng 06 năm 1995

Vốn điều lệ 710 tỷ đồng

Doanh thu 2012 2.380 tỷ đồng

Số lượng Nhân viên trên 1.690 người

Số lượng Đại lý trên 3.420 đại lý

Công ty thành viên 61 công ty

The Company's organizational and management structure includes:

- General Meeting of Shareholders

- Administrative Council

- Director-General

- Control Board

The organizational structure includes the Board of Directors, Board of General Directors,

21 professional departments at the Headquarters and 59 member companies operating in most provinces and cities nationwide

NGUYÊN THỊ HƯƠNG GIANG

BUI HOAI GIANG

LE THANH ĐẠT TRẤN ANH TUẦN BUI VAN sae TRAN HOAI NAM

PJICO has expanded in total assets, shareholder capital and nationwide business network In 2018, PJICO has total assets of 6,230 billion VND (270 million USD), shareholder equity of 1,502 billion VND (65 million USD) The enterprise has developed

61 member units across provinces and cities, creating a strong agent network owned by organizations and individuals In 2020, total revenue reached 4,138 billion VND, an increase of 13% compared to 2019 Highest profit ever, pre-tax profit reached 217 billion VND, an increase of 8.5% compared to 2019

1.2 Business model and operations:

1.2.1, Business model:

Known as the ever first joint stock insurance enterprise in Vietnam established by six founding shareholders: Petrolimex, Vietcombank, Vnsteel, Vinare, Matexim and Hanel, Pjico demonstrates a reality of Petrolimex vision in realizing the Party and State major guidelines on restructuring the Vietnam’s economy for successful integration Being the first insurer in Vietnam to operate under the joint stock model, constantly growing, and having gained an image and a true trust in the minds of customers, from its inception until now PETROLIMEX Insurance Company (PJICO) strives to become one

of the four leading units in the Vietnamese market in non-life insurance

With a business model that is encouraged and supported by the State, with a policy on insurance fees, and especially effective, dedicated and attentive service, PJICO has acquired an image and a belief real news in the minds of customers

Recently, PJICO Insurance pioneered in implementing a business model oriented towards centralized management, diversifying products and distribution channels, promoting risk management and building a system Advanced information technology to provide customers with perfect services and lasting value

1.2.2 Operations:

On September 20, 2023, Petrolimex Insurance Joint Stock Corporation (PJICO) and FPT Group officially launched the Consulting Project to implement digital transformation for the period 2023-2028 With the orientation of building a digital business platform and optimizing value for users, digital transformation has become one of PJICO's important strategies

DỰ ÂN TƯ YÂN CMUYÊN ĐÔI $0 TONG CONG TY CO PHAN BAG HIEM PETROLIMEX

1.3 Financial performance:

AM

CBEST

SINCE 1899 www.ambest.com

Recently in Singapore, the world's leading financial credit rating organization AMBest announced the 2023 credit rating of PJICO Insurance

AMBest continues to rank PJICO 's financial capacity at "B++" (good), ranking the issuer's capacity at "bbb" (good) In particular, in 2023, AM Best will add a national credit rating (National Scale Rating - NSR) applicable to each country's market, converted from the rating results according to international standards Accordingly, PJICO's rating after conversion by National rating 1s "aaa.VN" - the highest level in Vietnam The outlook for upgrading indicators is stable

This ranking result was announced by AMBest on the basis of a comprehensive assessment of all aspects of PJICO's operations over many years, including financial capacity, business results, operational efficiency, development strategy and system risk

management

To maintain the ranking, PJICO has made efforts to complete evaluation data and adjust the management system to comply with the strict standards of international credit rating organizations

PJICO's financial capacity 1s measured through the capital adequacy ratio (BCAR), highly appreciated by AMBest The Corporation maintains a prudent investment strategy, stable and safe reinsurance structure, continues to transfer reinsurance to markets with high credit ratings, contributing to supporting insurance capacity for large-scale risk groups such as: Property - Engineering, Maritime, Aviation - Energy, as well as managing other risk groups

In the period 2018 - 2022, PJICO's average return on equity (ROE) is at 12.2%, combined expense ratio is at 97.1%, helping the business have good profits from insurance business activities PICO always maintains the Professional Reserve Fund and especially the Large Fluctuation Reserve Fund at the highest level in the non-life insurance market This also ensures that PJICO fully meets its financial capacity in compensation payments,

ensures service quality and is a foundation for businesses to proactively implement future business strategies

In addition, the recent restructuring of the Corporation's operating model along with a strict risk management framework and development strategy based on two orientations

"Green transformation" and "Digital transformation" of PJICO is also considered suitable for businesses and current operating practices

By the end of October 2023, PJICO's insurance premium revenue reached more than 3,180 billion VND, an increase of more than 6% over the same period Pre-tax profit in the first 9 months of the year reached more than 238 billion VND, up 19% over the same period

CHAPTER 2: Products and services offered:

2.1 Motor vehicle insurance:

2.1.1 Value-added service:

24/7 hotline support service (Hotline): 1900545455

The hotline operates 24/7, PJICO is always ready to advise, assist in answering information, receive accident notifications and guide customers through compensation claim procedures

Traffic rescue service:

¢ Rescue when an accident occurs: Customers who participate in vehicle physical insurance at PJICO will be paid by PJICO for actual, reasonable and maximum accident rescue costs equal to 10% of the insurance amount when a loss occurs under insurance liability (Current car insurance rules)

e Emergency traffic rescue: All types of cars under 24 seats and trucks under 3 tons participate in physical or civil liability insurance at PJICO when a technical problem occurs or an accident prevents them from moving within the validity period If you have insurance, you will be served by PJICO's rescue vehicle for free within a 70 km radius from the rescue center address to the place of the accident

Guarantee service to pay repair costs:

When the vehicle is repaired at units cooperating with PJICO to provide repair services, PJICO will guarantee payment of costs determined to be the responsibility of the

2.1.2 Compulsory civil liability insurance:

Participating in compulsory civil liability insurance for car owners means that you have complied with the State's legal policies and road traffic laws

The principle of insurance is "Compensating for the unlucky few" by the many In case of

an accident, insurance companies will use the insurance money collected from the many

to compensate them A few people had accidents That helps some people who cause accidents for some reason not to run away, to be responsible for the accident that has occurred according to the liability level of the insurance they participated in, and not to

be criminally prosecuted for loss ability to compensate other subjects

¢ Insurance liability level for property damage caused by cars, tractors, construction vehicles, agricultural and forestry vehicles and other special vehicles used for security and defense purposes ( including trailers and semi-trailers pulled by cars

or tractors) causing 100 million VND/1 accident

2.1.3, Passenger Cover in Car Insurance

Passenger accident insurance covers the driver, assistant and other people in the vehicle who suffer physical damage due to an accident while in the vehicle, getting in or out of the vehicle while the vehicle is in traffic

Applicable subjects: Driver, assistant and other people are carried in the vehicle Coverage:

e Accidents to people being carried in the vehicle: Bodily damage caused by accidents while in the vehicle, getting in and out of the vehicle while the vehicle is

Coverage:

PJICO is responsible for compensating motor vehicle owners for physical damage caused by natural disasters, unexpected and unforeseen accidents in the following cases:

¢ Collision, collision Gncluding collision with objects other than motor vehicles), overturning, falling, sinking, fallmg of the entire vehicle, being hit by other objects;

e Fire, conflagration, explosion;

e Force majeure disasters caused by nature;

¢ Loss of entire vehicle due to theft or robbery;

In addition to the compensation amount, PJICO also reimburses motor vehicle owners for necessary and reasonable expenses as agreed in the insurance contract to perform the work as requested and instructed by PJICO when a loss occurs (under the scope of msurance), including costs:

¢ Prevention costs to limit additional losses;

¢ Costs for rescuing and transporting the damaged vehicle to the nearest repair place, but not exceeding 10% of the insurance amount

2.2.1 Health insurance for individuals

A type of voluntary insurance that helps pay part or all of the costs of treatment at medical facilities Gn the list of hospitals and clinics in the contract) when the insured person 1s sick or injured, accident, health care and rehabilitation

¢ Does not exist during treatment of illness or disability

Attractive insurance benefits at Pyjico exclusively for individual:

¢ Comprehensive health protection: Life, illness, pre-existing diseases, accidents 24/24 up to 500 million/year

¢ Maternity care up to 25 million/year

¢ Choose high quality medical facilities according to customer needs

® Guaranteed hospital fees at more than 200 affiliated medical facilities nationwide

¢ Competitive insurance premiums, applying the same fee schedule for all ages

¢ 5% discount for family contracts: father, mother & child join at the same time

2.2.2 Health insurance for employees:

This is a type of insurance that businesses buy to protect the health of employees

in the unfortunate event of illness or unexpected accident

With the health insurance package, employees will receive health care in modem, convenient medical conditions without having to worry about treatment costs Medical expenses such as: medical examination, medicine, surgery, image diagnosis will be paid by the insurance company according to actual expenses,

up to the limit of the insurance package, based on the invoice valid documents Health insurance can also support employees in preventing diseases and improving their health with extended benefits such as periodic health checks, vaccinations, etc

Why should you buy health insurance for employees even though you already have health insurance?

In addition to the benefits for businesses, health insurance packages for employees also bring many benefits to participants, similar to life insurance packages with somewhat lower costs such as:

® No need to queue or jostle during medical examination and treatment to enjoy insurance benefits

¢ Get medical examination outside the hospital as well as medical examination at high-end affiliated international hospitals if mentioned within the insurance scope

¢ Get paid for more drugs than Health Insurance

¢ Used in conjunction with health insurance to minimize additional costs

2.3 Technical insurance

2.3.1 Machinery breakdown insurance

Enterprise/manufacturing plant owners, machinery and equipment lessors, machinery and equipment lessees, machinery users

Coverage:

Coverage for machinery that is subject to material damage that is unexpected and does not occur before execution due to causes such as errors in the forging and forging of materials, design errors, errors at the workshop or during installation , gross workmanship defects, lack of skill, lack of care, lack of water in vapor content, physical explosion, centrifugal force tearing, short circuit, storm and other causes not excluded under the Insurance rules

Insurance fees:

Insurance premium is calculated as a percentage of the insured amount (machinery value) Based on the characteristics and properties of each machine and specific production and business activities, there are different applicable fee

rates

2.3.2 Insurance for contractor's machinery and equipment

Construction/installation machinery and equipment owned by the contractor or rented

by the contractor such as: bulldozers, excavators, crushers, road rollers, cranes, crane equipment, lifting equipment, pile driver, compactor

Coverage:

Insurance for damaged machinery and equipment, sudden and unforeseen physical loss due to any cause not excluded as mentioned in the Insurance Rules Some main risks are insured such as: natural disasters, fire, explosion, overturning, collision within the construction site

Insurance fees:

Insurance premium is calculated as a percentage of the insured amount (machinery value) Based on the characteristics and properties of each machine and specific insurance location, there are different applicable fee rates

2.3.3 Completed civil works insurance

The owner of the project, the person responsible for taking care of and using the project

Coverage:

Insurance for physical, unexpected and unforeseeable losses due to the following causes:

e Fire, lightning, explosion, collision of land and water vehicles;

¢ Collision by aircraft and other aviation vehicles or equipment falling on them;

e Earthquakes, volcanoes, tsunamis;

e Thunderstorm (the movement of wind at a speed stronger than level 8 on the Beaufort scale);

e Flood or inundation, wave or water action;

e Subsidence, landslides, rockfall or other land movements;

e Frost, avalanche, ice;

e¢ Vandalism by single individuals

Insurance fees:

Insurance premiums are calculated as a percentage of the imsured amount (construction value) Based on the characteristics and nature of the specific project, there are different applicable fee rates

2.3.4 Insurance for all risks in construction

Investors, construction contractors and parties with related nghts and obligations (engineers, architects )

Coverage:

Insurance for losses arising during the construction and installation process (such as building houses, hotels, factories, irrigation works, civil works ) Main risks that can be insured: Fire, explosion, natural disasters, floods, liability arising to third parties

Insurance fees:

Insurance premiums are calculated as a percentage of the insured amount (construction value) Depending on the characteristics and nature of the specific project, there are different applicable fees

2.4 Insurance assets

2.4.1 Compulsory Fire and Explosion Insurance

Compulsory fire and explosion insurance is a type of fire and explosion risk insurance implemented in accordance with the provisions of Circular 220TT/2010/BTC issued on December 30, 2010 regulating the compulsory fire and explosion insurance regime

Target customers: Owners of business establishments with facilities at risk of fire and explosion specified in Appendix | of Decree No 35/2003/ND-CP and Clause

7, Article 1 of Decree No 46/2012/ND-CP

Coverage: Compensate for unexpected and unforeseen accidental physical loss or damage to the insured property and caused by fire, lightning, explosion as prescribed in Circular No 220/2010/TT- BTC dated December 30, 2010 of the Minister of Finance on guiding the implementation of mandatory fire and explosion insurance regime Insurance for physical damage occurring to the insured subject due to the following risks:

e Fire is a chemical reaction that produces heat and light due to explosion or any other cause

¢ Explosion is a chemical reaction that causes the sudden release of gas and energy in large quantities while emitting sound and physically affecting surrounding objects

2.4.2 Fire insurance and special risks

Fire and special risks insurance is a type of msurance that compensates for accidental, unexpected, and unforeseeable physical damage caused by fire, explosion, and other risks mentioned above clearly stated in the Insurance Rules Applies to the following asset types: Housing, architectural works; Equipment and machinery; Goods and materials

factory owners, warehouse owners, etc

Coverage: Insurance for physical damage occurring to the insured subject due to the following risks:

Risk “A”: Fire; lightning strike, explosion

Risk “B”: Explosion

Risk “C”: Falling of aircraft and other aerial vehicles or their equipment Risk “D”: Disruption, strikes, lockouts

Risk “E”:Damage due to malicious acts

Risk “F”: Earthquake or volcanic eruption

Risk “G”: Thunderstorms and storms

Risk “H”: Thunderstorms, storms, floods

Risk “T’: Overflow from water tanks and equipment or water pipes

Risk “J°: Collision by vehicles and animals

2.4.3 Insurance for all property risks

This is protection for all tangible physical assets that are subject to loss, damage, destruction and can be measured in money including:

¢ Real estate (excluding land) and all movable property attached thereto

® Types of machinery and equipment

¢ Goods include finished products, semi-finished products, raw materials, unfinished products, accounting books, drawings, models

e Other assets not excluded under “Excluded assets”

e The contract can also be extended to assets such as money, rare objects, rare books or works of art

Coverage: Insurance for Material Damage occurring to the insured subject due to the following risks:

e Fire (including lightning)

¢ Explode

e Thunderstorms, storms, floods (including sea water overflow)

e Breakage or overflow of water from water tanks, water storage equipment