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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.

Sunday, May 29, 2011

LIC should be one-stop destination for all household needs


Our desire is to make LIC a one-stop-shop for all kinds of financial products
DK Mehrotra, 58, has taken over as the acting chairman of the Life Insurance Corporation. He was heading the marketing operations of the corporation for last three years. In an exclusive interview with FE’s Sitanshu Swain and Kumud Das, he outlines strategies to expand the business of the corporation. Excerpts:
Do you think the recent developments where the activities of LIC investment department and LIC Housing Finance has come under CBI scanner has created crisis of confidence?
I don’t think so. LIC has been fully cooperating with the government agencies. All I can say is that  though we have already got a robust system in place for investment operations , there was always scope for improvement. I can assure all the policyholders that their money is in safe hands.
What will be your agenda for the LIC ?
LIC should be one stop destination for all household needs of the  country, in matter of financial products. We want to create a formidable synergy among our different operation. We want to create a platform where our agent can cross- sell all these products . We have also tied up with various agency channels for expanding our marketing net-work..
Is the MF business doing well?
With Nomura’s entry, we are getting
hopeful of regaining our market share in the MF space. We will create a synergy in selling MFs and life insurance products by agents  
Any plans of foraying into banking?
We are open to the idea of setting up a bank. We are waiting for the final guidelines by RBI. But, we are not looking at taking over a bank. We will continue to have the strategic investment in Corporation Bank which will remain as the distribution partner of LIC in certain areas. Our strategic investment other banks will also continue.
Will you appoint a consultant to bring about these changes?
If need be, we will definitely go for it.
How do you plan to redesign LIC’s market strategies to meet the competition from pvt cos?
We are creating segments for each of the four areas as already mentioned. It will create synergy between sellers and buyers.
If you see the industry’s performance particularly on the Ulip front, it was growing for past four years. However, the industry was hit since the strict norms Irda came in force in September last year. We think our dependence should be more on conventional products. We will be happy to have a product mix of 65:35, between our Ulip and traditional products. This mix may come down to to 60:40 by the fiscal-end. We have been trying to do segmentation of branches and agency force to sell various kinds of products. Our agency force is most equipped to face the challenges. We are looking at having four segments in our agency force, which includes wealth management. Our desire is to make LIC a one-stop-shop for all kinds of financial products, like mutual fund and housing loan.
How you are changing your customer service?
We want to be a market leader, not only in financial products, but on the customer services front, too. We have already settled 1.83 crore of claims in 2011-12 and paid a sum of R55,000 crore to our policyholders.
What are your investment plans?
This year, we are planning to invest a total sum of R2,15,000 crore and 20% out of it will go in equities.  We are very conservative player in the capital market. We are a long-term investor and don’t speculate.
We have been investing R4,000-5,000 crore during last 2-3 months when the Sensex had fallen. We have invested R43,000 crore in equities last year. Our total investment kitty last year was at R1,85,000 crore.
Will you support if the Sensex  fall by a greater degree?
Market will be stabilised in next few months.Volatility in the stock market needs domestic players like us to stabilise. If situation arises, we will support the stock market , but we will first take care of policy holders’ investments.
What are your plans for international operations?
Currently, the contribution coming from the international operation almost negligible. But, we are targeting 5% of our total premium income from our international operations within next five years. Our Singapore operation will kick off by June-end. We are also looking at expanding in Asia Pacific and New Zealand.
What are your targets for premium and policies in 2011-12
We sold 3.7 crore of policies during last fiscal, it may go up to 4.26 crore. We are likely to record R 54,000 crore of premium, as compared to R4,4000 crore in 2010-11.

2 comments:

  1. J.E.ANDREW JESUDOSS,DOJune 2, 2011 at 7:49 AM

    The LIC management has already paralysed its main marketing arm by introducing a worst incentive scheme for its DOs,allowing IRDA to introduce the new MAB scheme which insists 1 lakh premium making so many agents exit from LIC,creating rivalry amongst its marketing force by introducing CLIA system,also unethically spending so much of people's money to develop so many non-viable alternate channels.New chairman should think twice before he acts, if he's really interested in LIC's welfare.
    ANDREW,DO,LIC
    RASIPURAM

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