LIC India Term Insurance Plans – Latest News
LIC planning healthier incentives to retain its agents
Life Insurance Corporation of India is planning better incentive schemes for its representatives in order to keep them retained with the corporation. The state-owned insurance provider is planning to employ over 1 lakh agents in this financial year.
Some senior executives at the corporation also confirmed that LIC had lost about 1.5 lakh of its individual agents. The major reasons behind the loss were a less significant number of fresh products and stiff business targets.
According to the data provided by Life Insurance Council, Life Insurance Corporation of India had a close to 10.61 lakh agents as on 31st march 2016 and approximately 11.63 lakh in the FY 2014-15. At present, the corporation has about 22,000 development officers, who are managing individual agents teams and their progress.
As per the senior company officials of the company, the attrition has majorly happened due to stiff business targets. Each LIC agent has a set target of selling a least 12 policies per annum. In case of failure in achieving this target the agent gets another years time to compensate it. But, in case the same continues for the thirst years, his registration gets cancelled.
Allahabad Bank to issue preferential shares worth Rs. 57 Crore to LIC
One of the major public sectors lenders, Allahabad Bank is planning to rise more than Rs. 57 Crore in the form of preferential shares to the Life Insurance Corporation of India. This verdict was made during the extraordinary general meeting of the Allahabad Bank. The meeting was held on 30th March 2016.
In a regulatory filing, Allahabad Bank stated that the LIC of India has given its consent to subscribe to about 132 lakh preference equity shares of Allahabad bank. Unit price per share would be 43.42 on preferential basis. The purchase would be subject to a 14.5 % cap on the original share capital.
This is only one of the many purchases of equity stakes that LIC has made in the past few months. Apart from Allahabad Bank, LIC has also purchased stakes in State Bank of India, HDFC Bank, Oriental Bank of Commerce, Corporation Bank and Union Bank of India among others.
Mid-Level Management of LIC reorganized this week
Life Insurance Corporation of India has recently undergone a major mid-level change as it has shifted about 40 EDs (executive directors) and elevated 10 GMs as Executive Directors.
The company is expecting two more senior officers to be appointed. This is because, SB Mainak, one amongst its three MDs (managing directors), got retired in the month of February this year. The company has appealed for government permissions to appoint the fourth managing director. However, the result on same is still awaited.
Before the retirement, Mainak was handling the investments division of the company. The initial hring round for the managing directors position has already been carried out.
The Life Insurance Corporation of India has also retained its two senior Executive Directors – and Saroj Dikhale, CEO, LIC Nomura MF and Sunita Sharma, CE and MD of LICHFL – in their pre-existing positions.
As revealed by the sources, the transfers and changes have come into effect since 11th April, 2016 and the charges will be handed over effective may.
LIC at present is being lead by S.K. Roy, chairman of the company and has only two managing directors, namely, Usha Sangwan and V K Sharma.
MoU to be signed between SIDBI and LIC
A memorandum has been signed between Life Insurance Corporation of Indi and SIDBI (Small Industries Development Bank of India) in order to enhance governments efforts being put in the fund-of-fund functions for the benefit of venture fund industry.
The major objective behind the memorandum was to promote startups in the countrys economy.
As stated by CMD of SIDBI, Kshatrapati Shivaji, at the SIDBI startup conclave, the MoU has been executed to put in towards the capital of MSME focused venture of SIDBI with IAF (India Aspiration Fund).
SIDBI has setup India Aspiration Fund as a division of the Fund-of-Fund functions. The corpus of IAF is worth Rs. 2,000 Crore as per the 2015 budget announcement.
As mentioned by CMD of LIC, K Roy, Life Insurance Corporation of India will be contribute about 10 % of the corpus size of India Aspiration Fund being handled by SIDBI.
LIC Buys additional Stake in Dena Bank and other Public Sector Lenders
Life Insurance Corporation of India (LIC) recently purchased over 2 crore shares from the leading public sector lender, Dena Bank. With this stake purchase, the insurance companys stake in the public sector lender has increased to 14.5 percent, which earlier stood at 11.63 percent. On the other hand, the government has got its stake decreased to 62.89 percent, which earlier stood at 65 percent.
Previously, LIC also bought over 4.23 percent stake from Andhra Bank, which is equivalent to 28, 853, 210 shares while keeping the price per unit a secret. Including the current stake purchase, the life insurance company owns over 14.39 percent stake in the bank, which earlier stood at 10.15 percent. This share trading was live on BSE, at Rs. 51.70, which is up 3.50 percent.
LIC Bonds worth Rs. 250 crore with KRCL
LIC recently expressed its interest and has successfully subscribed to a bond worth Rs. 250 crore with KRCL (Konark Railway Corporation Limited). The insurance company aims at enabling a few of the key projects.
At the celebration event of 25th Foundation Day, Suresh Prabhu, Railway Minister unveiled some of these projects, including Konark Railway Route electrification and doubling, and construction of several new passenger terminals and halt stations. As per a press release by KRCL, these projects have been taken up for upgrading the regions by the government of India PSU.
The Chairman & Managing Director of KRCL, Mr. Sanjay Gupta, said that the support offered by Life Insurance Corporation of India is going to go a long way, aiming at assisting the development of projects that are more passenger-friendly.
Life Insurance Corporation of India Buys Additional Stake in ICICI Bank and HDFC Bank
Life Insurance Corporation of India, the largest public sector insurer in India, has increased its stake in ICICI Bank, one of the leading private sector banks in India. This is according to results published regarding the 2015 October to December quarter. LIC is currently considered to be among the top three largest domestic investor purchasing equity on the stock exchange in order to gain benefit from the decline in share prices in India.
Apart from raising its share in ICICI and HDFC Bank, Life Insurance Corporation of India has also sold off part of its stake in key banks such as IndusInd Bank, Bank of Baroda, Bank of Maharashtra, Punjab National Bank, State Bank of Mysore, Vijaya Bank and others. Other banks in which LIC has recently made stake acquisitions recently include IDBI Bank and Corporation Bank.
Life Insurance Corporation of India Makes Acquisitions of Rs. 2750 Crores
Life Insurance Corporation of India, the leading public-sector life insurer in India, has invested an equivalent of Rs. 2750 crores in shares of leading Indian public sector banks. This policy of LIC to purchase shares of these banks has been ongoing for a period of about 4 years and is helping at least 9 public sector banks keep their share prices relatively stable in an environment where most investors are shying away from investing in public banks, which currently hold stressed loans of Rs. 8 lakhs crores.
Recent acquisitions include those made by Life Insurance Corporation of India in Dena Bank, Allahabad Bank, Andhra Bank, Central Bank of India, Indian Overseas Bank, Oriental Bank, Syndicate Bank, Vijaya Bank and IDBI Bank. This trend is expected to continue with more banks expected to undergo similar transactions by LIC. This news comes on the back of finance minister Arun Jaitley announcing that the government would infuse an estimated Rs. 25,000 crores of capital in public sector banks during the 2016-2017 fiscal.
Highway Ministry Likely to get Funds from LIC for Expressways Construction
The Ministry of Road Transport and Highways is intending to draw funds from Life Insurance Corporation of India to fulfill its aspirational development program of expressways while Mr. Nitin Gadkari, the Road Transport Minister of India has already nodded his approval for proposal implementation. The government of India is looking forward to awarding the contract for an estimated 10,000km road construction on expressways, as mentioned in the Union Budget proposal.
Based on this budgetary allocation, the road transport and highway ministry would efficiently build only 7, 000 km of expressways while the remaining portion is subject to the funds or loan approval from the largest financial entity in the country, LIC. Once the funds are approved, the ministry could actually start building its aspirational expressways through this extra-budgetary support.
Life Insurance Corporation to Witness 40% Y-o-Y Decline in Equity Investment Profits
Life Insurance Corporation, the largest life insurer in India, has announced that it expects to witness a 40% decline in Y-o-Y profit on its equity investments during the 2015 to 2016 fiscal year. LIC expects to book a profit of Rs. 15,000 crores for the fiscal year ending 31st March 2016, which is the lowest equity investment return recorded by LIC in the past five years. This decline in LICs profits is expected to have an adverse effect on LICs valuation surplus.
Valuation surplus is the surplus cash available with the company for distribution to its customers and shareholders who hold policies/bonds that entitle them to a share of profits. Apart from these individuals, lower equity profits will also mean lower dividend receipts by the government as it holds 95% stake in Life Insurance Corporation of India.
IRDA has approved LICs move of introducing third option in the gender field of proposal form
Dominating more than 70% of the life insurance industry, the Life Insurance Corporation of India (LIC), has incorporated third gender as a choice in its proposal forms. This has been done in accordance with the verdict of Supreme Court recognizing it in 2014. The buyers of insurance policy, till now, had an option to choose between ‘male’ and ‘female’ in the gender field. But, the transgender applicants now have an option to choose the new ‘third gender’ option.
Considering the dominance of the LIC in the insurance industry, the change is considerable and expected to drive trends in the market. However, except National Pension System, no other insurance or mutual fund company recognizes the third gender. Considerable, this option was included in the Indian Passports in 2005l.
SK Roy, the chairman of LIC, said, that Supreme Court, in a verdict commended by human rights groups, called on the administration to make sure that they (third gender) receive an equal treatment and the advice has been taken up for for implementation.
Life Insurance Corporation of India to Buy Stake in Oriental Bank of Commerce
Life Insurance Corporation of India, the leading government-owned life insurer in India, is all set to buy additional stake worth Rs. 178 Crores of Oriental Bank of Commerce, a leading public-sector bank based out of Gurgaon, India. This is a reduced capital infusion requirement as compared to the Rs. 500 Crores requirement from LIC, which was projected by OBC earlier. In order to enable LIC to purchase this additional stake, OBC will be offering an estimated Rs. 21.5 million shares at Rs. 82.79 for each share.
This additional stake purchase would increase LICs holdings in OBC to 14.5% as compared to the 8.36% holding the insurer had earlier. As a result of this purchase by LIC, the central govern-held stake in Oriental Bank of Commerce decreases to 55.17%. This purchase by Life Insurance Corporation of India is expected to be approved by OBC shareholders by March 29, 2016.