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Trichy, Tamil Nadu, India
Working as an Assistant in LIC of India, Rockfort BO, Trichy, TN. Having a strong belief that LIC's welfare is our welfare and always trying to work towards that. Also functioning as an office bearer of AIIEA Thanjavur Division.

Saturday, August 7, 2010

LIC's total income for 2009-10 is Rs 2,98,721 Crore

           MUMBAI: State-owned Life Insurance Corporation of India (LIC) has emerged much stronger in the months following the uncertainty over unit-linked insurance plans (Ulips). The corporation has seen its market share spike to 73.4% by end-June ’10, from 60.79% during end-March ’09.

In the first quarter of the current fiscal, LIC has managed to grow its market share in new businesses by recording the first-year premium of Rs 18,740 crore — an increase of 107% over the corresponding quarter last year. As against this, the new business premium for the rest of the industry was Rs 12,884 crore. However, all private life insurance companies put together could generate a new business premium of only Rs 7,126 crore — an increase of 28% over the year-ago period.
Most of the premium came from single premium Ulips. Some of the corporation’s key Ulips are slated to close in August, as all insurance companies are expected to file new products that are compliant with the new guidelines.
These numbers were divulged by TS Vijayan, chairman, LIC on Friday while announcing business results for 2009-2010, following a board meeting on Thursday. For 2009-2010, the corporation recorded a total income of Rs 2,98,721 crore — an increase of 49.2% over the previous year. This included premium income of Rs 1,85,985 crore, which was 18.3% higher than last year.
“Since we are the lowest cost operator in the market, we have some advantage,” said Mr Vijayan. He said that the corporation was in better position today, because the focus has been on increasing returns for policyholders by curtailing expenses and not on profits.
According to Mr Vijayan, the corporation would have to only tweak some of its Ulips to bring the charge structure in line with the new regulations prescribed by the regulator. He said that most of the charges were within the limits. However, LIC would need to do some restructuring to reduce the impact of charges on those who exit their policy after five years.
At the end of the first quarter, LIC had made investments amounting to Rs 39,000 crore. Of which, an investment of Rs 10,000 crore was pumped into equities. Mr Vijayan said that the corporation was targeting investments to the tune of Rs 2 lakh crore during the current year. “The investment pattern would depend on how much money will be raised through unit-linked insurance plans. Our experience is
that sales of Ulips rise whenever the equity market is doing well and traditional policies do well whenever interest rates rise,” said Mr Vijayan.

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