Page 55 - Quick Insights Book 2022

Chap. 12 – Insurance Companies

With their traditional audit knowledge and experience, Chartered THIRD PARTY ADMINISTRATORS SERVICES
Accountants can fit into this role with ease.
TPAs help insurers by reducing the administrative costs, while
ACTUARY making the claims settlement a smoother process for the
insured parties in health insurance. Because of the sensitive
Chartered Accountant with expert knowledge on actuarial nature of this function covering the genuineness of the claim
science an be of immense help and helps in carrying out and timely payment of the claim and the heavy processing of
actuarial services such as complying with the provisions accounting data involved, this area can be best handled by
with respect to the basis of premium, ensuring that the Chartered Accountants with appropriate qualification.
policyholders’ reasonable expectations have been considered
in the matter of valuation of liabilities and distribution of surplus MANAGEMENT OF PORTFOLIO
to the participating policyholders who are entitled for a share
of surplus etc. The insurer possesses huge amount of funds, which need
proper management. The management of the port- folio of an
SURVEY OR LOSS ASSESSOR insurance company requires the identification of investment
avenues, evaluation thereof and the selection of the most
An insurance survey or is a technical expert who inspects the appropriate mix of alternatives where the funds of the company
damage or loss of an insurance company. There are advocacies can be invested. The selection requires the knowledge of
for survey and loss assessment job should be carried out by finance-related functions and techniques apart from in-depth
an independent, third party, licensed and categorized survey knowledge of the patterns of requirement of funds in the
or only. A Chartered Accountant can be of immense help in company, as well as in the industry as a whole, and the
assessing the damage or the loss to the object of Insurance. regulations of the IRDA in this behalf.
This area includes general functions like conducting inspections,
estimating and valuing the subject under loss. The Chartered Accountants are well versed with the methods
and techniques pertaining to the finance related decision-making
ARBITRATION including the application of scientific and statistical techniques
for the same. There is invariably a large scope for the utilisation
Arbitration is a procedure of settlement of dispute between two of the services of Chartered Accountants in this field.
parties by an authority called arbitrator. A Chartered Accountant
with a vast amount experience in various fields can assist the INSURANCE LITIGATION
parties to a dispute either as a counselor he may decide on the
dispute of the parties as an Arbitrator. The Chartered Accountants can render their professional
expertise in the quantification of claims, both personal injury
INSURANCE INVESTIGATIONS and business interruption claims. They may also render their
services in determining the consideration of liability involving
A Chartered Accountant may also carry out insurance accountants’ negligence and for other professional negligence
investigations for the insurance company or the IRDA. For cases. They may also provide their knowledge in rendering
e.g. in case of a false claim the professional can investigate assistance of fidelity insurance disputes and insurance
on the amount of loss actually suffered by the insured and accounting disputes.
the compensation claimed by the insured from the Insurance
Company to gauge the veracity of the claim made and the FORENSIC AUDITING / INVESTIGATIVE
amount of compensation to be done. ASSIGNMENTS

RISK MANAGEMENT The insurance industry is susceptible for fraudulent / inflated
claims. The examples of fraudulent claims include auto
This is a critical area and involves review of the efficiency and accidents faked or staged to claim benefits, phony burglaries,
adequacy of risk management techniques. Additional areas thefts, or acts of vandalism reported to insurers.
of responsibility are business continuity planning, conducting
alternative risk financing feasibility studies and evolving loss Chartered Accountants with their inherent inquisitive abilities
minimisation strategies etc. Chartered Accountants will find sharpened by their training can provide a lot of value addition
these functions stimulating. to the claim settling techniques. The investigative skills aided by
their probing minds and technical assistance can be effectively
utilised by insurers by offering investigative assignments to the
Chartered Accountants.

42 Quick Insights on Professional Opportunities for Chartered Accountants