‘Rising awareness has helped reduce surrender of policies’

Despite the initial setback in April and May due to the nationwide lockdown, Life Insurance Corporation of India (LIC) is optimistic that it will regain the lost ground and continue on its growth path, said Managing Director Vipin Anand. As on date, LIC has settled COVID-19 related claims on 776 policies, amounting to ₹24.43 crore. Excerpts:

Except for the impact of COVID-19 on our new business during April and May, our performance has been very good. Whatever impact we have seen during these two months, we will recover soon.

In first-year premium, our market share up to July 2020 was 71.5%. Likewise, market share for number of policies increased to 64.2% up to July 2020, from 61.7% of June 2020 and 56.9% of May 2020. Under individual assurances, market share for July was 56.9% against 51% of June. The month’s share in number of polices also rose to 68.5%, from 65.7% as of June 2020.

LIC procures a big chunk of its new business through its agency channel; agents were not able to move during the first two months of this fiscal. Now, with unlocking, our agents have begun to move, and there is visible improvement in our performance. Besides, COVID-19 has raised the level of awareness about the need for life insurance. We are getting many enquiries for our online products, as well as on the ground through our field force.

The outlook is very promising. People are now more aware about life insurance. We are gearing up on the new business front after initial hiccups and will surpass all targets.

Revenue-wise, in terms of new business premium, we have recovered from the initial shock and have started showing growth. In case of renewal premium we are already showing growth and it will increase further. As to investment income, the activity has also regained the past year’s momentum and there have been good profit-booking opportunities in this period as well as for picking up value stocks at good prices. The other positive signal is that leakages in the form of surrenders have reduced substantially with increased awareness.

In new business, we are showing growth on most parameters. We have seen considerable growth in premium collections under existing policies. COVID-19 has also increased awareness among customers to keep their policies in force. We have also brought out a special revival campaign with interest concessions to enable policyholders to revive their lapsed policies and restore their risk cover.

Now you can pay your LIC premium by visiting our customer portal and paying via your credit card, debit card, netbanking, UPI. As to collection of premium through the digital mode, the total number of transactions during the current financial year till July 31, is 5.81 crore against 3.51 crore a year earlier, showing growth of 65.4%. In collection amounts, the growth is nearly 105% i.e. we have collected ₹22,733.50 crore against ₹11,051.03 crore of the same period last year.

Be sure, no stakeholder will be adversely impacted by this decision. In fact, it will lead to further strengthening of LIC’s already robust systems, unlock value for the government for helping in social welfare and also give policyholders and other stakeholders an opportunity to benefit from LIC’s performance if they choose to become shareholders.

As on date, we have settled claims on 776 policies amounting to ₹24.43 crore.

LIC is at the forefront of helping families of the deceased. At most places, our people have actively located the whereabouts of the deceased to make death claim payments on priority.

We have disbursed 51,51,486 maturity claims and survival benefits compared to 47,96,751 claims paid during the same period last year; we have made 1,78,850 death claim payments

as against 2,29,070 in the same

period last year.