Human resource quality of pvi insurance corporation

NATIONAL ECONOMIC UNIVERSITYEXCELLENT EDUCATIONAL PROGRAM ---o0o---BACHELOR’S THESIS Major: Business Management HUMAN RESOURCE QUALITY OF PVI INSURANCE CORPORATION Student : Le Yen Chi

NATIONAL ECONOMIC UNIVERSITY

EXCELLENT EDUCATIONAL PROGRAM

-o0o -BACHELOR’S THESIS Major: Business Management

HUMAN RESOURCE QUALITY OF PVI INSURANCE

CORPORATION

Student : Le Yen Chi Student’s code : CQ530436 Class : Business Aministration

Instructor : A Luong Thu Ha

HA NOI, 05/2015

INTRODUCTION 1

CHAPTER 1: INTRODUCTION OF PVI INSURANCE CORPORATION3 1.1 Overview of PVI Insurance Corporation 3

1.1.1 Basic information: 3

1.1.2 The formation and development of PVI Insurance Corporation 3

1.2 The organizational structure and responsibilities of the departments 7

1.2.1 The organizational structure of PVI Insurance Corporation 7

1.2.2 The mission of the departments within the company 8

1.3 Characteristics of the main business 12

1.3.1 Characteristics of services offered 12

1.3.2 Characteristics of market 13

1.3.2 Characteristics of insurance customers 15

1.4 Business performance in the period 2010 - 2014 17

1.4.1 Main results 17

1.4.2 General assessment of the production - the company's business period 2010 - 2014 18

CHAPTER 2 HUMAN RESOURCE QUALITY OF PVI INSURANCE CORPORATION 21

2.1 Human resource of PVI Insurance Corporation 21

2.1.1 Human resource by educational levels 23

2.1.2 Human resource by English levels 25

2.1.3 Human resource by computer skills 25

2.1.4 Analysis of ethical and professional behavior 26

2.2 Factors effecting human resource quality of PVI Insurance Corporation27 2.2.1 Internal factors 27

2.2.2 External factors 37

2.3 Human resource quality of PVI Insurance Corporation 39

2.4 General assessment of human resource quality of PVI Insurance Corporation 40

2.3.1 Advantages 40

2.3.2 Disadvantages and reasons 41

CHAPTER 3 ORIENTATION AND SOLUTIONS TO IMPROVE THE HUMAN RESOURCE QUALITY OF PVI INSURANCE CORPORATION 44

3.1 Business strategies and orientation for improving the human resource quality in PVI Insurance Corporation 44

3.1.1 The basis for determining the orientation 44

3.1.2 Strategic objectives for the insurance industry and PVI Insurance Corporation 45

3.1.3 Orientation to improve human resource quality 47

3.2 Some key measures aimed at improving the quality of human resources.48 3.2.1 Improved organizational structure 48

3.2.2 Completing the human resource planning 49

3.2.3 Development of standards for work performance 50

3.2.4 Improved recruitment activities 51

3.2.5 Human Resource Training 52

3.2.6 Remuneration and incentives 53

CONCLUSION 55

REFERENCES 56

LIST OF TABLES AND CHARTS

TABLE 1 : The consolidated business results of PVI in 2014 18

TABLE 2 : Comparing growth of premiums of leading insurers (2010 - 2014) 19

TABLE 3 : Growth in market share of insurers (2010 -2014) 19

TABLE 4 : Growth of equity and total assets of leading insurer (2010 - 2014) 20

TABLE 5 : The number of employees of PVI from 2011 to 2014 21

TABLE 4 - The structure of labor according to education level 24

TABLE 5 : PVI’s ASSET in the period 2011 – 2013 32

TABLE 6 : PVI’s Revenue and Underwritting Reserve in the period 2009 -2013 .32 CHART 1: PVI Insurance Corporation Organization chart 7

CHART 2 : Insurance Market Share from 2010 to 2014 14

CHART 3: Market share in some typical industrial insurance sectors in 2013 14

CHART 4 : PVI Human Resources 2008 – 2013 22

CHART 5 : PVI Working Age Year 2013 23

CHART 6 : Manpower structure by age and language proficiency of workers 25

CHART 7 : Manpower structure by age and level of computerization 25

CHART 8 : Number of employees of PVI from 2008 to 2013 by sex 29

CHART 8 : PVI's Revenue growth 2008 - 2013 33

CHART 9 : PVI's Financial Figures Growth 2010 - 2013 33

In Vietnam, after 20 years of opening itself for business, there have beendramatic socio-economic changes Vietnam's insurance market in general and thefield of non-life insurance in particular are increasingly being extended with thebroad participation of all economic sectors in the business of insurance services Up

to now, there are 29 enterprises of non-life insurance, 14 life insurance firms, and

12 insurance brokerage firms in operation

Many of the life insurance products and non-life insurance products relating

to property, personal insurance, and liability insurance have been implemented tomeet the diverse needs of participants and create a competitive choice forcustomers Along with the growth in the number of insurers as well as the scalingoperation, the number of people working in the insurance industry also increasedsignificantly, creating jobs for thousands of people

PVI was established in 1996, and inherited power and trademarks of theNational Oil and Gas Group Vietnam PVI is gradually developing and asserting itsposition in the insurance market in Hanoi as well as in the country Currently, PVIhas approximately 1,500 employees and nearly 900 professional insurance agents

In the future, to boost production and business activities, PVI is strengthening thesales team in quantity and quality, to create a team of professional insurance agents

to expand markets, and strengthen the relationships with partners and customers

The human beings, although highly qualified, but small in number, are oftenuntrained and inexperienced in the intricacies of the new profession, and as suchmay not be able to meet the job requirements, leading to difficulties for thecompany External job searches are difficult due to the specific requirements ofPVI So improving the quality of its human resources is urgently required for PVI inthe future

During the period of development of the Socialist-oriented market economy

we became increasingly aware of the crucial role of human resources, especiallyhuman resources quality as an important factor for the development of economicgrowth of the country in general, as well as strong growth in PVI InsuranceCorporation in particular And this is also why I chose the theme: "Improving the

quality of human PVI Insurance Corporation" to study.

Besides the introduction, conclusion, and list of references, the essay structureincludes 4 chapters:

Chapter 1: Introduction of PVI Insurance Corporation

Chapter 2: Rationale and practice of improving human resources quality ininsurance companies

Chapter 3: Reality of human resources quality in PVI Insurance Company

Chapter 4: Orientation and solutions to improve the human resources quality in PVIInsurance Coporation

First and foremost I would like to offer my sincerest gratitude to myinstructor, Mrs Luong Thu Ha, Lecturer, Faculty Of Business Management,National Economic University, who has supported me throughout my internshipreport I express my greatest thanks to Mr Phan Truong Thai, Deputy Director,Human Resources Division for his kind permission to allow me for two monthsinternship at PVI Insurance Corporation I would like to thank the employees of thecompany Finally, I thank my parents for supporting me throughout all my studies atNational Economic University, and for providing me a home in which to complete

my internship report

CHAPTER 1:

INTRODUCTION OF PVI INSURANCE CORPORATION

1.1 Overview of PVI Insurance Corporation

1.1.1 Basic information:

PVI Insurance is a unique insurance enterprise in Vietnam, which hasexperience of being in charge of providing successful insurance programs for oiland gas projects in combination with property and engineering insurance up to avalue of one billion USD

In the style of a professional Insurer, PVI Insurance was successful inproviding the consultancies and risk management programs as well as insuranceservices for many major projects for domestic and international contractors

Company's Name: PVI INSURANCE CORPORATION

Address: 168 Tran Thai Tong Street, Cau Giay District, Ha Noi

Phone: (04) 3.7335588

Fax: (04) 3.7336284

Website: http://www.pvi.com.vn

1.1.2 The formation and development of PVI Insurance Corporation

PVI Insurance Corporation (PVI Insurance) is an affiliated company of PVI

Holdings, which was formerly known as Petrovietnam Insurance Joint StockCorporation (PVI) Established in 1996, PVI Holdings successfully restructured in

2011, which was actually a shining light in many ways Throughout strategicpartnership with the Talanx Group, the 3rd largest insurance group in Germany, PVIHoldings has formally participated in global service provision Specifically, theTalanx Group acquired 32% stake and 11% stake of Oman Investment Fund (OIF)

in PVI Holdings Moreover, Sun Life Canada also became the strategic partner withPVI Holdings to establish PVI Sun Life in Viet Nam

Along with successful capital raising and strategic partners’ selection, PVIHoldings has undergone a comprehensive restructuring The new corporatestructure of PVI Holdings consists of three subsidiaries: PVI Insurance Corporation,PVI Re-insurance Company and PVI Sun Life For each, PVI Insurance hasinherited all rights, obligations and responsibilities in non-life insurance of PVIInsurance such as finance, experience, clients, branches, the world’s leadingunderwriters and reinsurance brokers, etc PVI Insurance is currently a publiccompany with its major shares owned by Petrovietnam Oil and Gas Group In 2008,Standard & Poor's, the world’s most prestigious credit rating organization, ranked

PVI Insurance among the top 10 stocks with the highest level of liquidity inVietnam.

With an extensive sales network that comprises 26 member companies andover 150 independent sales offices stretching nationwide and operating in variousareas of insurance, reinsurance, investment and other related businesses, PVIInsurance has more than 1,500 employees who are positively active, enthusiasticand professionally trained and always aim to provide the best services to customers.Since 2002, PVI Insurance has been granted Management System QualityCertificate ISO 9001:2008 by Vietnam Certification Center (Quacert) and DetNorske Verita Organization (DNV)

With the motto “Loyalty and Dedication”, PVI Insurance's insurance services

have always been highly appreciated by the customers, and valued for their goodquality, high security and competitive premiums PVI Insurance, as a professionalinsurer, has always been dedicatedly assisting clients with consultation, riskmanagement and loss prevention and limitation

So far, the company has been successful in arranging numerous insuranceprograms for the property and construction of Petroleum Industry which are worthbillions of dollars, such as Nghi Son Refinery and Petrochemical Complex Projects,Formosa Integrated Steel and Port Complex, Dung Quat Oil Refinery Plant, ThaiBinh 1 & 2 Thermal Power Plant, Phu My Fertilizer Plant…

Moreover, PVI Insurance has played a significant role in the market as apioneer in providing insurance programs to foreign markets, for example rigbuilding projects in South Korea, exploiting activities in overlapping areas PM3between Malaysia and Vietnam and petroleum exploration and production projects

in Algeria, Russia, Venezuela, Cuba and China, etc., which has brought a largesource of foreign currency into Vietnam

Adding to its oil and gas insurance business, PVI Insurance is pushing thesupply of non oil and gas insurance services such as motor insurance, personalaccident insurance, Property All Risks Insurance (PAR) and Construction All RisksInsurance (CAR) for such national major projects as Nghi Son refinery andpetrochemical complex, Formosa integrated steel and port complex, Dung Quatrefinery plant, Thai Binh 2 TPP, Thai Binh 1 TPP, Vung Ang 1 TPP, Nhon Trach 1TPP, Nhon Trach 2 TPP, Ca Mau 1 TPP, Ca Mau 2 TPP, O Mon 1 TPP unit 2, MaoKhe TPP, Lai Chau HPP, Xekaman 3 Hydropower Plant, Ban Chat HPP, NamChien HPP, Dong Nai 3 HPP, Dong Nai 5 HPP, Ben Thanh – Suoi Tien MetroLine, Noi Bai – Lao Cai Expressway (A6), Can Tho Bridge, Nhat Tan Bridge, HaNoi – Hai Phong Highway, Long Thanh – Dau Giay Highway, Van Phong Port, Cai

Mep Port, National Museum, PVN Tower…

For the purpose of safeguarding the company’s insurance business as well asdiversifying its insurance products and improving service quality, PVI Insurancehas regularly broadened and enhanced its close cooperation with the world’s leadingunderwriters like Munich Re, Zurich, Swiss Re, Lloyd's Syndicates, HDI Gerling,QBE, AIG Currently, PVI Insurance is considered by them to be their strategicpartner in Vietnam through the signing and maintenance of Energy Facility with alimit of 500 million USD and Onshore Facility with a total insurance value worth1.5 billion USD

With regards to its claim settlement, PVI Insurance has always coordinatedwith the related parties to promptly determine the cause of losses and conductsatisfactory indemnity for the customer Up to now, PVI Insurance has settled agreat number of big claims with indemnity amount reaching millions of USD such

as losses of CNV1P Well (24 million USD), Pipeline losses of JVPC (12 millionUSD) and goods losses of Saigon Commercial Corporation (10 million USD), CanTho Bridge (3 million USD), Da Rang Bridge (350,000 million USD), etc

According to the market data reported by Association Insurance Vietnam in thefirst half of 2013, PVI Insurance ranks top in Vietnamese non-life insurance marketregarding market share and remains in its high position in terms of basic financialcriteria such as capital, owner equities and total assets Commanding strongcustomer faith and enormous confidence, PVI Insurance, in accordance with itsvision for the period 2010-2015, endeavors to become a leading Insurance andFinancial Group in Vietnam, with its brand name to be recognized internationally

PVI’s development milestones

On the 21st of January 1996, Petro Vietnam Insurance was established as alocal insurance company for the petroleum industry, managing all risks and assets

of the sector in the country and internationally

In 2006, following the trend of the market economy, PVI equitizationconducted a series of changes in the governance structure and business strategy, andwas renamed the Petro Vietnam Insurance Corporation This began its road tosuccess On the 30th of December 2006, PVI began offering shares to the public

In 2010, PVI became the first insurer to receive the financial rank of B +(Good) by the financial ratings body AM BEST On the 21st of September 2010,PVI was awarded the First Class Labour Order by becoming a strategic partner ofthe Oman Investment Fund (OIF) in 2010, and through a series of ambitiousprojects PVI confirmed their position of number 1 on the insurance market of

Vietnam, entirely convincing World Finance Magazine (UK), who then awardedPVI the prestigious "State Insurance of the Year 2010" award.

On the 27th of May 2011, PVI was awarded the title Hero of Labour InAugust 2011 they restructured to create the parent company JSC PVI, a companywith two subsidiaries operating in the field of non-life insurance (PVI InsuranceCorporation) and reinsurance (PVI Reinsurance Company) In November 2011, PVIbecome strategic partners of the Talanx Group (Germany)

In 2012, to finalize the operational model according to the plan proposedrestructuring, PVI-prepared for the introduction of the 02 subsidiary LimitedLiability Company PVI Sun Life Insurance Company Life Shares AssetManagement PVI AM PVI Sun Life's goal, the company owned 51% by PVIcharter capital and Sun Life Financial (Canada) owned 49% of charter capital, is tobecome a leading enterprise in the field of life insurance in Vietnam Month 7/2012,PVI has also increased its chartered capital to 2342 billion through the issuance ofprivate placement shares for existing shareholders' strategy Talanx Group(Germany)

In 2013, PVI focused on strengthening corporate restructuring PVI Sun LifeInsurance was officially launched Subsequently, on the 16th of June in Ho Chi MinhCity, the 27th of July in Hanoi and the 4th of August in Da Nang City, PVI Sun LifeInsurance placed its life insurance products on the market In the same year, theGeneral Corporation PVI Reinsurance (PVI Re) has completed transition to a modelstock company with registered capital of 668 billion, of which 68.86% of the capitalbelongs to PVI PVI Re reinsurers are also eligible under the Security List ofTalanx

In 2014, PVI has received recognition from highly reputable organizationswithin and outside the country, received a financial rating of B + (Good) frominternational rating agency AM Best in both the fields of insurance and reinsurance,and been selected by Forbes as one of 50 best listed companies on the stock market

of Vietnam

1.2 The organizational structure and responsibilities of the departments

1.2.1 The organizational structure of PVI Insurance Corporation

CHART 1: PVI Insurance Corporation Organization chart

Source: PVI capacity profile 2014

BOARD OF DIRECTOR

BOARD OF MANAGEMENT SUPERVISING

PLANNING & BUSINESS

PVI HA NOI PVI TP HO CHI MINH

PVI SONG HONG PVI KHANH HOA PVI THANH HOA PVI TAY NGUYEN PVI DUYEN HAI PVI DONG NAM BO PVI BAC TRUNG BO PVI BINH DUONG PVI DA NANG PVI SONG TIEN

1.2.2 The mission of the departments within the company

To take up a new position in the insurance business as non-life insurancemarket leader in Vietnam, PVI Insurance has, since its inception, undergone somechanges in the organizational structure The improvement of management is always

an urgent requirement to find a more efficient model, to seek advantages overcompetitors and strongly promote the capacity of departments, offices andemployees of the company With the growth of the total oil and gas insurancecompany, organization also gradually was adjusted to find the most appropriatemodel

Currently conducted after equitization, the organizational structure of theinsurance is as follows:

+ Board of Directors: As a management agency firm, has full authority to representthe company to decide all matters relating to the purpose of the rights of theCompany except for matters under the shareholders' meeting

+ Board of Management: To manage the company, headed by the Director General,

in charge of the daily operations of the company; is responsible before the board onthe rights and duties

+ Supervising: Perform the inspection of the legality of the management of businessoperations, evaluation and annual financial reports

+ Internal Control Division: Chamber of internal controls, implementingrecruitment and training, personnel arrangement, salary increase promotion rewardsand discipline for officers of the company departments Also responsible for roombuilding standards, manning positions of the room and considering the proposal toauthorize the member companies of the leasing office

+ Planning & Business Division:

Function: To advise and assist the Director in directing the business strategy, term plans and short-term economic efficiency, business development andinvestment in capital construction

long-Duties: Performing management tasks in accordance with the regulations of themanagement system according to ISO 9001- 2001 of the company, which include:Business plan statistical analysis of the performance of business, the investment incapital construction

+ Finance & Accounting Division:

Accounting Department: implementing the norms of cost and profitability of the

company and its subsidiaries, analyzing business performance of the unit.

Financial Department: responsible for accounting settlement of contracts, managingprincipal premiums, payment of compensation, data compilation of financialstatements, business settlement rates (loss), implementation of the tax obligation tothe State

+ Claim settlement Division: This division is responsible for resolving disputesabout benefits for clients; making customers understand their rights have beenrespected in each case of the loss of each type of insurance contract Also in charge

of resolving all customer queries, thereby determining compensation liability andcompensation; conducting rapid, accurate and correct objections

+ Human Resources Division: Division of personnel is responsible for mattersrelating to the staff of the enterprise, being a balancing force for business needs;planning and construction process of recruitment, training, use layout and assessingthe effectiveness of staff; policy formulation and rewards and discipline to ensurethe stimulation of employees Implementation of the regime under the Labor Codeand the regulations of the leading companies

+ Information Technology Division: In order to implement strategies to build oiland gas into a strong brand in the oil and gas group, with operations on a worldwidescale, and ready-economic integration with the region and the world Petroleuminsurance companies place special emphasis on investments in informationtechnology, a measure indispensable in the business of insurance In addition,direct-dial phones, informatics management information systems in business andindustrial, construction management processes by organizing information also raisethe level of staff in the company

+ Marine Insurance Division: a Sales Manager to spearhead the company's threemain types of services: hull insurance, cargo insurance, insurance of civil liability ofship-owners departmental revenue of over 100 billion each year Takingadvantage of a member of the PVN by managing and operating the fleet with thelargest load in Vietnam, and in 2007 PVI continued growth as market leader in thefield of hull insurance and civil liability shipownerership PVI also offers insurancefor large fleets of Vietnam (Vosco, Vitranschart ) PVI provides all insuranceproducts such as marine hull insurance, civil liability of ship-owners, personalaccident insurance for the crew, cargo insurance

+ Underwriting Management Division: their purpose is the development of core services, market research, customer search, seizing potential, thereby makingmarketing solutions

non-+ Reinsurance Division: the function and duties of the committee is arrangingreinsurance effectively and safely for services in excess of those retained by thecompany, in collaboration with the business units in the negotiation of the premiumoffered for competition from international markets and reinsurance business bothdomestically and internationally.

+ Administration Division: this division is responsible for summing up the businessoperations of the reporting enterprise's board of directors; managing and resolvingdaily tasks; receiving and sending letters to and from organizations and serviceagencies, organizing conferences, summarizing the department is the integratedadvisory body of the company leadership

+ Personnel and Vehicle Management Division: This division is responsible for thefollowing issues:

Personal Accident Insurance

Individual life insurance

Insurance subsidized hospitalization and surgery

Personal Insurance combination

Domestic Travel Insurance

Insurance of Vietnam who travel abroad

Insurance for foreigners traveling Vietnam

Personal accident insurance for foreigners

Insurance of civil liability of motor vehicle owners to third parties and forpassengers

Insurance of civil liability of vehicle owners for goods passenger

Physical damage insurance of motor vehicles

Insurance against car and motorcycle accidents

Insurance for a combination of motor vehicles

+ Oil and Aviation Management Division: This division is responsible for all the oiland gas contracts, which means to provide all the oil and gas insurance productsavailable in the market such as Control Wells Insurance, Liability Insurance, ThirdParty Insurance, Property and equipment for oil and gas, construction insuranceoutside offshore, oil in storage and in transit, and all according to international

standards Furthermore, this division deals with aviation contracts with aviationcompanies such as Vietnam Airlines and Vietjet and an agreement to purchase theaircraft with aircraft manufacturers such as Boeing and Airbus

+ Corporation Risk Division: The provision of work undertaken in accordance withthe function, as the name implies This division analyses and accounts every riskthat could happen in every contract PVI signed with customers

+ The regional branches: The company currently has 26 branches with regionaloffices, which deliver products and services to the oil and gas industry:

Petrovietnam Insurance Company Southern Region Branch

Petrovietnam Insurance Company Hue Branch

Petrovietnam Insurance Company Thang Long Branch

Petrovietnam Insurance Company Ben Thanh Branch

Petrovietnam Insurance Company Hai Duong Branch

Petrovietnam Insurance Company Quang Ninh Branch

PetroVietnam Insurance Company Ha Noi Branch

PetrovVietnam Insurance Company Dong Do Branch

Petrovietnam Insurance Company North Red River Branch

Petrovietnam Insurance Company South River Red Branch

Petrovietnam Insurance Company Ca Mau Branch

Petrovietnam Insurance Company Red River Branch

Petrovietnam Insurance Company Thanh Hoa Branch

Petrovietnam Insurance Company Highland Branch

PetroVietnam Insurance Company North Branch

PetroVietnam Insurance Company Da Nang Branch

PetroVietnam Insurance Company South East Branch

PetroVietnam Insurance Company Khanh Hoa Branch

Petrovietnam Insurance Company Dong Nai Branch

Petrovietnam Insurance Company Pacific Branch

Petrovietnam Insurance Company Song Tien Branch

PetroVietnam Insurance Company Sai Gon Branch

PetroVietnam Insurance Company Ho Chi Minh City Branch

PetroVietnam Insurance Company Vung Tau Branch

1.3 Characteristics of the main business

1.3.1 Characteristics of services offered

Oil & Gas Insurance:  PVI offers a wide range of services and insuranceplans One such plan is Oil and Gas Insurance This service covers bodily injury andproperty damage for oil and gas lease operators, drilling contractors and oil or gaswell service contractors. It also covers all risks in association with platforms,drilling barges and oil and gas well drilling equipment floaters In addition to this,the service also covers Energy Exploration and development as well as offshoreconstruction projects

Marine Insurance: Marine Insurance covers P& I, personal accident of crew,cargo (including transport via air, sea, and land), engineering insurance, electronicequipment, and machinery breakdown All risks in relation to the construction anderection process are also covered within this service

Property Insurance: Property insurance includes all risks associated withproperty It covers money and theft, as well as fire insurance Some special risksmay also be covered such as accidents and natural disasters

Liability Insurance: Liability Insurance covers third party liability, productliability, public liability and workmen compensation There is a compulsory service

of workmen compensation for construction products As well as this, BVI offersprofessional indemnity insurance and design consultation, and risk assessment

Personal Insurance: Personal Insurance is a comprehensive service thatcovers personal accidents, hospitalization and surgical allowance They offer travelinsurance for Vietnamese customers travelling both inside Vietnam and abroad, andtravel insurance for foreigners inside Vietnam Personal Accident Insurance forforeigners however has limited liability of up to 10,000 USD

Motor Vehicle Insurance: Motor Vehicle insurance covers Owners’ CivilLiability for Third Party and Passengers, Goods in Transit, and Physical DamageInsurance In addition to this, it covers Personal Accident of Drivers, Drivers'Assistants and Passengers

1.3.2 Characteristics of market

On the basis of positive growth in 2014, the insurer said that 2015 willcontinue to be a successful year for the insurance industry, promising growth in thefuture; the market potential is still great and the legal framework for insuranceactivities increases with preferential tax policies for individuals / businesses to buyinsurance The market for insurance in 2015 will continue to grow as the insuranceneeds of the people are still very large The latest statistics show that the totalnumber of insurance contracts is just over 5.5 million, but insurance companies arestill promoting the expansion of the distribution network in the provinces, through asystem of individual agents, while promoting the diversification of distributionchannels through links with financial institutions the financial and non-economicsituation is better identified in 2015 and will also actively support the increasingnumber of insurance contracts

In 2015, the economy is expected to remain difficult, due to the uncertainties

in the world It is not easy to predict the evolution of the insurance market becauseeconomic difficulties have two effects and have always seemed contradictory to theinsurance market On the one hand, enterprises and individuals tend to cut spending

On the other hand, the instability will create the need to be protected, with financialsecurity And we still see relatively clear chances in 2015 for growth

Furthermore, insurance in Vietnam maintains good growth, with theparticipation of many businesses and people increasingly more concerned aboutprotecting the financial security for themselves and their families Meanwhile, thelegal framework in Vietnam on business insurance is also completed on the basis ofprotecting the client’s interests and facilitates the insurance business operations.Vietnam's economy recovered and promises to thrive in the future The rate ofinflation is under control and stable The income of households continues to rise.The insurance market in 2014 saw impressive growth and revenue is estimated toincrease 22% from various new insurance contracts This is the foundation andtremendous opportunity for the insurance business to flourish in 2015

Market Share of PVI Insurance

According to the Ministry of Finance and the Vietnam InsuranceAssociation, PVI Insurance has ranked second in Vietnam’s non-life insurancemarket in terms of market share in 2008, 2009 and 2010 and ranked first in anumber of significant areas in the insurance industry In the first half of 2014, PVIInsurance emerged to be the biggest Insurer in Vietnam’s market with 22.3%market share

CHART 2 : Insurance Market Share from 2010 to 2014

Source: PVI Capacity Profile 2014

CHART 3: Market share in some typical industrial insurance sectors in 2013

Source: PVI Capacity Profile 2014 International Relationship:

PVI Insurance has strong relationship with many Foreign Investors andContractors such as: Doosan Corporation, Posco E&C, Keangnam Enterprise,Daelim Group, Technip Consotium, Nipon Oil, Sumitomo, Idemitsu Oil & Gas,Huyndai E&C, Mitsubishi Corporation, Wuhan Kaidi Electric Power Engineering

Co Ltd and Sojitz Corporation,…

PVI Insurance has close relationships with the world’s leading underwritersand reinsurance brokers like Munich Re, Zurich, Swiss Re, Lloyd’s syndicates, HDIGerling PVI Insurance is the only company in Vietnam that has a reinsuranceenergy contract (Facility) with Lloyd’s Syndicates with a limit of liability up to 500Million USD and reinsurance property and engineering contract (Facility) withSwiss Re, Allianz, Zurich Re, etc… with limit of liability over 1.5 billion Dollars –ranked the first and only in Vietnam

1.3.2 Characteristics of insurance customers

Customers of insurance companies are all organizations and individuals toHDBH Winners and Losers for insurers and insurance premiums Each individual

or organization can participate by signing contracts in many different types ofinsurance In fact, insurance clients and subjects covered are as diverse ascustomers, and complex risks and the severity of risk can be very different indifferent cases Therefore, the insurer must conduct screening and in many casesrefuse insurance if the severity of the risk is too large, the risk that the client givesinsurers too bad, or the probability of discharge loss almost certain Customers ofinsurance companies, especially non-life insurers, are generally classified into twocategories: individual customers, and clients as organizations Although theorganizations expect the same professional customer service as individuals, thebasic difference between the two groups of customers is the complexity of the riskassessment and the use of different methods to prevent and limit the risks

The group of individuals has the following characteristics:

- They always expect insurance gives them a certain number of benefits Thereforethey are often interested in the price and value of the product, which means theywill look to the insurer that provides the broadest coverage at the lowest cost

- The majority of clients wishing to participate in this type of insurance with thelarge insurance companies, those that are reputable, highly skilled and with whichthey are familiar They may look outside because agents or insurance brokerslooking for the best insurance policy will find one in accordance with the needs andwants of their clients

- The psychological aspects of this group are dominated by customs and habits andcan carry heavy elements of superstition Generally they do not want to talk aboutthe risks and consequences specifically Many customers do not see the benefit ofinsurance products immediately after purchase, especially for non-life insurance, asthey shall not be entitled to any income from insurance premium amounts, or they

do not understand the technical aspects of the insurance business, which is toestablish reserve funds, and reserve and invest idle funds They may feel "cheated"

in their appearance Therefore the insurer must take care to reassure thesecustomers

Group private clients often require:

- Motor vehicle insurance

- Insurance ships

- Multi-risk insurance of housing

- Insurance of crops and livestock

- Personal Insurance

Another customer group are social and economic organizations This groupmainly consists of business, professional and social organizations and the businessadministrative units They need to be protected against damage, loss of assetsrelated to property, and human responsibility Their assets are buildings, machinery,liability, cargo can be lost, stolen or destroyed due to many different reasons Whenthese assets can be lost, making business and production halted and interrupted, theproperty itself as well as damages and repair costs would be a financial burden forthem Besides, enterprises and social organizations should also be insured fordealing with liability arising from production and business operations caused byothers Also some characteristics are similar to individual customer groups,customer groups are social and economic organizations which also have thefollowing characteristics:

- They are big customers, so require high pay-out insurance contracts, especially thecustomers participating in oil and gas insurance, aviation, construction installation.This feature requires insurers to adopt policies to keep customers wise, so as toprotect existing market share, ensure the renewal of the contract, avoid cancellation

of the contract before deadline or not continue to buy insurance when the contractexpires

- The majority of customers are business and professional organizations, and needprofessional advice on insurance, insurance forms, and on issues related to the work

of preventing and limiting losses This feature requires insurers to work effectively

to advise clients on risk management and loss control If you satisfy these needs,insurance companies can attract new customers, maintain relationships with existingcustomers and will take advantage in the marketplace, surpassing competitors that

do not have the ability to supply this level of service

- The business and professional society organizations are diverse in size, industryand type of business and production activities, so the insurer must rely on differentcriteria to carry out goods classification for ways to meet the different needs ofcustomers in the best way.

The group of business and professional society organizations often requireinsurance in the following categories:

- Fire insurance and business interruption

1.4 Business performance in the period 2010 - 2014

1.4.1 Main results

Thanks to a proper development strategy and effective business solutions,PVI has successfully exceeded all the planned targets in 2003 With 18 years ofdevelopment, this is the first time the total revenue of PVI exceeded 8000 billionVND With domestic enterprise in mobilizing the foreign capital to develop stragicplanning, PVI has become an insurance – finance group with a prestigious andinternational brand name

TABLE 1 : The consolidated business results of PVI in 2014

Total revenue 8,030 VND Billion

Revenue from financial activities 788 VND Billion

Profit before tax 361 VND Billion

Profit after tax 241 VND Billion

Payable to State budget 560 VND Billion

Source: PVI Annual Report 2014

With strong financial capacity, PVI Insurance has focused investment inmajor projects such as oil and gas industry (oil vessels, low pressure gas projects),

as well as in banks, security businesses and the business sector They have focused

on businesses that have high economic efficiency of financial investment, real estateinvestment, communications and securities

1.4.2 General assessment of the production - the company's business period

2010 - 2014

In the 18 years of establishment and operation (1996-2014), PVIInsurance has continually grown and flourished in both size and financial strength.Specifically as follows:

- Headed for growth: PVI Insurance an insurance company with growth of writtenpremiums higher than the average growth of the market and most of the leadinginsurance companies in Vietnam

TABLE 2 : Comparing growth of premiums of leading insurers (2010 - 2014)

Source: Insurance Association (2010-2014)

- One of the largest non-life insurance companies in Vietnam: market shares of PVIInsurance continued to increase over the years When established, the market share

of PVI Insurance was very small (4.2%), but in 2013 was 20.94%

TABLE 3 : Growth in market share of insurers (2010 -2014)

Source: Insurance Association (2010-2014)

- Leading industrial insurance market: by the end of 2014, PVI Insurance continued

to maintain its position as the number one insurance company in Vietnam with37.01% of the market section of hull insurance and responsible owner insurance,48.87% share of property insurance and damage and 55.44% of the market coveredbuilding installation PVI Insurance have been trusted to cover the entire property

and people in national key projects such as complex project Nghi Son oil refinery,The Long Son petrochemical, refinery Dung Quat Oil, Gas Cluster Project -Electrical - Ca Mau, Pacific Power Plant 2, O Mon Thermal Power Plant Unit 1 2,Nhon Trach Power Plant 1 and 2, O Mon Thermal Power Plant 1 Unit 2, Mao Khethermal power plant, hydropower plant Xekaman 3, NM Hydro Ban Chat, Kon TumHydropower Shanghai, Nam Chien Hydropower, Song Tranh 2 Hydropower, DongNai 3 Hydropower, Cards Dong Nai Power 5

- As one of the three leading insurance enterprises, the scale of equity and totalassets: by the end of December 2013, PVI Insurance is a non-life insurancecompany in the top three insurers, based on market capital and total assets As of12/31/2013, the charter capital of PVI Insurance reached 1850 VND billion, equity

of PVI Insurance is estimated at 1934 billion, total assets estimated at 5019 billion

TABLE 4 : Growth of equity and total assets of leading insurer (2010 - 2014)

Unit: VND Billion

Year

Equity Total Financial

Source: Insurance Association (2010-2014)

- The first insurance company Vietnam to be ranked by international credit rating at

B + (Good), for consecutive years confirmed objectively by an internationalindependent organization (AM Best), highlighting the ability to meet its obligationsunder regular insurance contracts According to the analysis of the organization,capital adequacy ratio (BCAR) of PVI Insurance over two years in 2011 (163%)and 2012 (141%) exceeds capital adequacy ratio, corresponding to minimum ratingGrade B + (100%) By early 2014, AM Best has officially improved credit ratingfinancial capacity of PVI Insurance to B ++

- Business Systems is expanding across the country with 28 member companies and

160 business offices, to ensure service and best meet the requirements of customers

CHAPTER 2 HUMAN RESOURCE QUALITY OF PVI INSURANCE

CORPORATION

2.1 Human resource of PVI Insurance Corporation

As of the 31st December 2014, the total number of employees at the parentcompany and its subsidiaries (PVI Insurance Corporation, PVI Reinsurance JointStock Corporation) was 1,949 people

TABLE 5 : The number of employees of PVI from 2011 to 2014

Source: PVI Annual Report 2014

The table shows that the number of employees in PVI increased graduallyfrom 2011 to 2014 which proves the strong development of the company duringthese years However, as can be seen besides the increase of employees in PVIInsurance, there was a dramatic drop in the number of workers in PVI Holdings andPVI Reinsurance This was due to the fact that PVI had restructured the wholecompany to improve the efficiency of PVI Insurance in business activities The rise

in the number of employees of PVI indicates that there was a higher job satisfactionamong employees, with a greater dedication to the company cause, as well asshowing PVI’s increased drive to grow their company

CHART 4 : PVI Human Resources 2008 – 2013

Unit: Person

Source: PVI Annual Report 2013

As shown in the chart, the total workforce as well as the total number ofemployees with tertiary education or higher in PVI has been rising constantly inrecent years In terms of the percentage of total workforce with third level education

in higher, there was an increase from 79% of total workforce in 2008 to 84% oftotal workforce in 2013 This displays a modest but important increase in theeducation level throughout PVI Thanks to the better system of recruitment in PVI,more qualified people are working for the company to help their firm to completethe planned targets in business activities

CHART 5 : PVI Working Age Year 2013

Source: PVI Annual Report 2013

Looking at figures for age across PVI for the year 2013, we can see that thevast majority of PVI’s workforce are below forty years old, with the largestdemographic between thirty and thirty-nine years old This shows that there are alot of younger workers in PVI, relatively fresh to the company This can be goodfor growth as younger workers will likely be hardworking, looking to their futurecareers, and can display a passion for business that might be absent from olderworkers It also shows PVI’s commitment to recruitment, with nearly forty percent

of workers under thirty years old If these younger workers can be trainedefficiently and incentivized appropriately, they will form the future of a dedicatedworkforce within the company However, the more experienced portion forms thenecessary backbone of experience within the company, and should not be neglected

as they are equally necessary to create an environment of respect andprofessionalism within the corporation

2.1.1 Human resource by educational levels

Currently the company has 4 categories of workers, including indefinite termcontracts and temporary collaborators contracts Because the company belongs tothe National Petroleum Corporation who is now trading under the central block ofthe government, all PVI’s leaders have to be admitted to the Party However, most

of the leaders of PVI are members of the young workforce (under 40), and they are

all not on long term contracts This is the core workforce in production and businessactivities of PVI

TABLE 4 - The structure of labor according to education level

Unit: Person

Under-graduation

Graduatio n

Upper Graduatio n

Total

The Board of Directors of the

Director, Deputy Director, the

Director, Deputy Director of

Chief, deputy of Member

2.1.2 Human resource by English levels

CHART 6 : Manpower structure by age and language proficiency of workers

Source: Human Resources Committee PVI Insurance Corporation

In the context of international economic integration in all respects, thelanguage which is the mode of communication is very important and necessary(mainly English) Therefore, staff and employees of English proficiency arerequired In the regulations on standards of leading specialists, management of thegovernment and PVI require foreign language proficiency when considering forappointment or reappointment Thus, according to the statistics, employees with thelevel of knowledge of foreign languages at C level English throughout PVI is 84%,although qualified people with A and B English levels are disproportionately low.Thus, virtually the entire PVI staff have an understanding of english

2.1.3 Human resource by computer skills

CHART 7 : Manpower structure by age and level of computerization

Source: Human Resources Committee PVI Insurance Corporation

Computer knowledge is a key element to support officers and staff, to fulfillthe assigned tasks, especially in the present context The application of informationtechnology is involved in all fields, especially applications in management.

Stemming from urgent requirements, over the years PVI InsuranceCorporation put a lot of effort into training and retraining to improve computerskills for all staff members According to the statistics, staff qualifications forCertificate of Computerization B or higher accounted for 84% of total PVImanpower

2.1.4 Analysis of ethical and professional behavior

Firstly, through practical operational processes for more than 18 years, thevast majority of PVI employees keeps their moral qualities pure, their lifestylehealthy, and is dedicated to customer service, as well as being thorough,enthusiastic and attentive

However, despite the qualities mentioned above, a handful of staff membershave displayed immoral or unprofessional conduct, including: lack of discipline,lack of cultivation, a decline in moral quality, sectarianism, poor sense of discipline,weak communication skills, inadequate customer service, bad attitude, evenbureaucratic arrogance The limitations and weaknesses of some employees havesometimes undermined credibility and the confidence of customers for PVI Toovercome the above limitations, next time in training and retraining resources, PVIhas been concerned with fostering moral standards, but also paying attention to thework routine, as well as political, ideological and moral qualities, to create a sense

of responsibility around the assigned tasks

Second, they have made efforts for the workers to have opportunities foradvancement in careers that require employees to understand the law and theirrights and obligations Key is that each employee should have the sense of self-cultivation, cultivation of virtue, and a law-abiding consciousness Efforts toimprove themselves in the observance of the hours, to adhere to labor discipline,and to understand and abide by the regulations made by PVI are essential

Third, in the present situation, the Party committees, agencies, units andemployees themselves should organize and implement an effective campaign studyand follow the moral example of Ho Chi Minh On the other hand, strengtheningchecks on the implementation of the tasks and duties in order to promptly detect andcorrect the errors, distortions, and adequately handle any violations PVI prescribedworking times are 22 days / month, working 5 days / week from Monday to Friday,for 8 hours per day