New policies to bring new high for LIC

‘JEEVAN UMANG’ offers survival benefit that is equal to 8% p.a of basic sum assured and paid up sum assured

Life Insurance Corporation (LIC) will continue to maintain its double digit growth in FY 2018, said chairman of LIC, V K Sharma, while launch of new policy ‘Jeevan Umang’. He added that this growth momentum will not just be limited to LIC but would be spread across the insurance sector. Thus, making next three to five years as the period for insurance business.

With the launch of ‘Jeevan Umang’, LIC is launching its sixth product in 45 days of the FY 2017-18. The company registered a growth of 27.22 per cent in the new business in terms of the first year premium in FY 2016-17, however, LIC has witnessed de-growth in number of new policies. Sharma added, “The primary reason for this degrowth in number of policies was the lack of availability of products. In 2013-14, the regulator closed down all (most) of the products. There after creating new products for all the segment has been a tough exercise. Slowly, we have built up 25-26 products now.” It had recently launched two Aadhaar-enabled products as well.

The new plan comes with a cover up to age of 100 years which will offer income and protections. Sharma believes that the new product will work as a breather for working youth in the country who might be in between jobs or in case there are any layoff in the future (leading to uncertainty in income). The plan provides for annual survival benefits from the end of the premium paying term till age 99 and a lump sum payment at the time of maturity or on the death of the policyholder during the policy term. The survival benefit will be equal to 8 per cent per annum of basic sum assured and paid up sum assured respectively.

Last year, LIC received Rs 15, 000 crore premium through ‘Jeevan Akshay’. Such policies is going to boost LIC’s double growth, Sharma said. He added that in a year or two, LIC will come back to the same levels in terms of new policies and that will give actual policy growth in times to come.

Sharma envisaged, “Our outlook for next 3-5 years is that, it is a period of insurance business – whether it is life or general insurance business. We have shown double digit growth. LIC has been ahead of the industry growth and we will continue that growth in the FY 2018 too.” Without revealing FY 2018 targets, LIC said, “Our FY 2018 targets are certainly much higher than the growth in FY 2017.”

“Our target is not just to keep the leadership position but ultimately keep the industry in the direction where it should remain.” Sharma added, “We have started increasing our market share slowly and we will continue to do it.”