Ceylinco Life Insurance Limited
INTEGRATED ANNUAL REPORT 2016

BUSINESS MODEL

Our Corporate Strategy

Strategic Direction

Our strategy is aimed at delivering sustainable growth in the competitive environment. Analysis of the operating environment and evaluation of industry attractiveness are the initial steps of our strategy formulation.

The success of our corporate strategy is based on efficient and effective deployment of our unique resources, core competencies and strengths. These are coupled with a thorough understanding of the macro-factors, in capitalising on opportunities and mitigating the threats within our broader value creation model.

Our strategy also involves management of risks within acceptable tolerance levels, to ensure risks do not impair our ability to meet our corporate goals and objectives.

Strategic Priorities

We strive to strengthen our business, by building on the past achievements and ensuring success in the future. Our dedication to forming ‘A Relationship for Life’ applies not just to our customers but to our employees, shareholders, business partners and other stakeholders.

As we map our key objectives for the future, we invite you to take an in-depth look into the future we have planned. Every goal we have built is on a strong foundation of investment, innovation and intention.

As you read on, you are taking a step further in your journey of knowing your insurer.

Staying Ahead of the Pack

We ended 2016 as the country’s #1 life insurer for the 13th consecutive year. Our goal is to maintain this position. We will achieve this through multiple mediums, including our commitment to prioritising our customers’ needs and convenience; our investment in our employees, business partners and other stakeholders, and our strong dedication to setting the standard for good corporate citizenship within the industry.

Exceptional Product Portfolio – We are proud to have a product portfolio that is inclusive – offering something for everyone. Our flexible, tailor-made, need based life insurance solutions allow our Sales team to cater to the specific requirements of policyholders.

Unmatched Customer Experience – Our product portfolio is supported by the widest network of customer touch points and unparalleled customer service. Our customer reach is second to none, with a branch network that stretches across the island. We are also the only insurance company to support a full time Sales Force, guaranteeing that our customers receive a dedicated and professional service at all times. We also continue to offer more convenient payment modes for the customer.

Our Sales and Customer Service teams are consistently focused on delivering increased value to our customers whilst building customer loyalty.

Growing Our Life Fund – We have the fastest growing Life Fund in the industry, and we intend to keep up this growth momentum in the years to come. This is a strategic priority for us since the growing Life Fund manifests the expanding ability of your insurer to meet policy obligations.

Capital Adequacy – Improving on our capital adequacy is a priority for us as this enables us to face unexpected risks and shocks. We will continue to improve the quality of our investment portfolio, build more admissible assets and impose more stringent investment guidelines and investment limits.

Increasing Market Share – At just 13%, life insurance penetration in Sri Lanka is still at a fledgling stage. As always, one of our primary goals is to increase the penetration of life insurance. We are already well-equipped to do this since our need based life insurance solutions allow our competent Sales Team to customise insurance plans to cater to individual needs of our customers. We will target every level of the consumer pyramid, engaging with customers from both rural and urban communities.

Developing Our Brand – In order to efficiently address the needs of these diverse markets, we will continuously improve our brand, and thereby add to brand equity.

Vision, Progress, Confidence and Trust are the key features of the new Ceylinco Life logo. The new tagline ‘A Relationship for Life’ refers to the relationship not only between policyholders and their loved ones, but between us and our customers and other stakeholders.

From 2017 onwards, we will be aggressively pursuing two key markets using very different policy solutions – retirement plans for Sri Lanka’s aging population, and long term insurance products suitable for the young, affluent, urban market. The future will see the launch of many new products and services.

Investing in People

As always the heart of our business lies with our staff. We ensure that we have the most dedicated and motivated team in the industry, by consistently adding value to them both personally and professionally. We start at the point of recruitment, with a minimum standard that must be met in terms of academic and professional qualifications. Every department at Ceylinco Life is headed by a qualified and experienced professional. We promote a learning culture through regular training and evaluation and create a unique, challenging and rewarding environment for all. We will continue to expand and improve this winning formula in 2017.

Our sales staff are in a class of their own within the local insurance industry. Our goal is to recruit, train and retain the best and we do this by investing in the best trainers and programmes. We also actively encourage our sales staff to become trainers themselves, to ensure that what is learned is passed on a continuous basis.

Strengthening Relationships and Collaborations

Successful relationship building is our forte, and we strive to create and maintain long term, positive relationships with all our stakeholders through policies that are grounded in trust, transparency and the highest ethical standards.

Caring for Our Policyholders – We strive to build the best relationships possible, from creation of customised policies to establishing the convenience of multiple touch points and payment solutions. Our efforts also include initiatives such as the popular Family Savari which is a much looked forward to event on our annual calendar. As always prompt settlement of claims and timely payment of benefits are integral to the values of our business which enables us to retain the trust of our policyholders. In the future, we will introduce more schemes to promote lasting relationships with policyholders by offering increased protection and benefits.

Collaborations with Stakeholders – Other key players in our business include suppliers, regulators, reinsurers and actuaries, and we strive to maintain excellent professional relationships with them all.

Reaping the Result of Smart Investing

Our investment strategy is aimed at reaping the best possible returns while keeping risks at the lowest level. Our professional investment team, with the guidance of the Investment Committee, will continue to maintain the level of prudence, ensuring that we gain the most from our investments in Government Securities, bank deposits, debentures and quoted shares, while always abiding by the guidelines issued by the IBSL.

Technology Development

We will invest in state-of-the-art information systems to support every aspect of our business operations. We plan to improve the reliability of our IT systems through proactive maintenance, refreshing the technology in our networks and service platforms in tandem with the latest developments in the field.

We recognise the importance of data privacy and security and will maintain the highest standards of privacy. We will also invest in improving our disaster recovery site with on line replication, which will ensure that our operations continue with minimum interruptions, and all our data is securely stored.

Championing Environmental Sustainability and Corporate Citizenship

Caring for the Environment – We will continue to take huge strides in our effort to ‘Go Green’. More of our branches will be equipped with solar power in the future. Our sustainability strategy also recognises the value of eco-friendly initiatives such as water recycling, rainwater harvesting and the like. In the future, we will endeavour to further reduce our environmental footprint and invest more in environmentally friendly initiatives. More importantly we hope that our efforts of the past, which we will continue to expand in the future and will serve to educate and inspire, more companies reduce their carbon footprint and do their bit to reduce negative environmental impacts as we have.

Continued Focus on Community Health and Education – We have long been engaged in developing community health and education infrastructure. We aim to uplift the health conditions of the public, contribute to providing better educational facilities to underprivileged children. This is because the core of what we do in the business of life insurance is enhancing the lives of the communities around us.

Strategy Delivery

We continued to achieve steady progress against our strategies in 2016 and set priorities for 2017. Given below is a snapshot of our actual performance in 2016 against a few key quantifiable objectives set in each strategic priority and our aspirations for 2017:

Objective for 2016 Performance in 2016 Status Objective for 2017
Staying Ahead of the Pack
Gross written premium of Rs. 15.8 Bn The Company achieved gross written premium of Rs. 15 Bn 95% Achieved Gross written premium of Rs. 18.7 Bn
Meet the Company minimum Capital Adequacy Ratio (CAR) of 200% (statutory requirement 120%) CAR was 335% as at
31 December 2016
Achieved Continue to meet the Company minimum Capital Adequacy Ratio (CAR)
Maintain annual Life Fund growth at 10% Life Fund grew by 14.5% Achieved Maintain annual Life Fund growth at 10%
Profit after tax of Rs. 2.5 Bn Profit after tax reached Rs. 3 Bn Achieved Profit after tax of Rs. 3.5 Bn
Investing in People
Maintain employee turnover below 15% Employee turnover reached 9.67% Achieved Maintain employee turnover below 15%
Maintain average employee service period over 8 years Average employee service period was 12 years (2015 – 11 years) Achieved Maintain average employee service period over 8 years
Employee training budget – Rs. 7 Mn Spent Rs. 7 Mn employee training Achieved Employee training budget – Rs. 8 Mn
Produce 25 Million Dollar Round Table (MDRT) qualifiers in the sales force Produced 44 qualifiers Achieved Produce 30 MDRT employees
Sales staff training budget – Rs. 20 Mn Spent Rs. 25 Mn sales
staff training
Achieved Sales staff training budget – Rs. 25 Mn
Relationships and Collaboration
Maintain length of customer relationship
at an average of 10-15 years
Length of customer
relationship – 15 years
Achieved Maintain length of customer relationship at an average of 10-15 years
Number of customer complaints as a percentage of average policies – below 5% 0.4% Achieved Number of customer complaints as a percentage of average policies – below 5%
Net benefits and claims – Rs. 6.3 Bn Rs. 6.6 Bn worth of benefits and claims paid Achieved The Company expects to pay Rs. 7 Bn in benefits and claims
Reaping the Result of Smart Investing
Investment income – Rs. 6.5 Bn Rs. 8.7 Bn investment
income earned
Achieved Investment income – Rs. 8 Bn
Maintain investments growth at 15% Investments grew by 20.27%
over 2015
Achieved Maintain investments growth at 18%
Technology Development
Percentage of sales officers enabled with
IT (laptops, tabs or smartphones) – 25%
35% of our sales officers are
IT enabled
Achieved Enabling 40% of the sales officers with IT
Championing Environment Sustainability and Corporate Citizenship
Planting of 3,400 trees under a special
‘Go-Green’ concept
4,400 trees were planted
island wide
Achieved This was a special initiative for 2016
Reduction of fuel consumption by 10% Fuel consumption was reduced
by 12% (43,000 litres) over 2015
Achieved Reduction of fuel consumption by 10%
Waidya Hamuva medical clinics – 12 14 medical camps conducted, treating 2,200 patients Achieved Waidya Hamuva medical clinics – 12
School development projects – 4 2 schools renovated benefiting 2,072 students 50% Achieved School development projects – 4