Corp Bank-Lic To Offer Cheap Assurance Plan

Corporation Bank, following a strategic alliance with the Life Insurance Corporation of India (LIC), will offer its customers a term assurance cover for a premium of Rs 9-10 per month, which will offer a sum assured of Rs 25,000 on death.

LIC will provide group term assurance to all customers of the bank. "Details of the scheme, including the cap on the upper limit of the risk cover, are being worked out," said A Ramamurthy, LIC's current in charge and managing director, at a function organised to announce the strategic tie-up between LIC Mutual Fund and Corporation Bank for the distribution of the fund's products through the bank channel.

Ramamurthy pointed out that mutual funds need to use the banking system in the collection of subscriptions and marketing of funds.

With LIC picking a 27 per cent stake in Corporation Bank, LIC Mutual Fund will now use the bank's branch network for collection of subscriptions.

"Thirty of our branches will initially be used for this purpose and subsequently increased," said Corporation Bank chairman and managing director K Cherian Varghese.

LIC expects to end the fiscal with an asset size of Rs 2,30,000 crore. This will reflect a 20 per cent growth over the preceding fiscal. "Competition has helped us," said Ramamurthy.

According to Ramamurthy, around 8-9 per cent of LIC's assets have been invested in capital markets which comes to around Rs 20,000 crore.

Total premium income of the corporation is expected to be in the region of Rs 46,000-48,000 crore this year against last year's Rs 35,000 crore.

Meanwhile, Corporation Bank has signed an agreement with the Delhi Metro Rail Corporation for installation of automated teller machines (ATMs) at the proposed Rs 4,860 crore mass rapid transport system (MRTS) stations in Delhi, Varghese said.

As per the terms of the agreement, the bank is allowed to install its ATMs at 11 sites allotted in the first phase of the MRTS project.