Life Insurance Corporation of India (LIC) has surpassed the targeted premium of Rs 1,830 crore under 'group insurance' schemes two months ahead of the close of the financial year. | |
| The corporation feels that rising group insurance business comes largely on the back of falling interest rates as corporates prefer to pass on the business to professional firms rather than managing in-house. |
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| The insurance behemoth wrote premiums worth Rs 2,021.32 crore under group insurance business as on January 31, 2004, translating into a growth rate of 129 per cent over last financial year. |
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| "Despite the intense competition in the group insurance business, we have seen an increasing tendency for corporates to go to professionals to run their welfare schemes. Interestingly, even when our quotation has not been the lowest among our peers, we have won the business," said S B Mathur, the LIC chairman. |
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| The number of new lives covered by the insurer under group insurance schemes has risen by 46 per cent to 18.33 lakh. The segment has become extremely competitive as players are vying to get corporate accounts even as there is a high risk of claims exceeding premium collections. |
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| LIC brought down its annuity rates last year and is expected to bring down them this year as well in the wake of falling interest rates. Its average yield on fresh investments has fallen by about 100 basis points to 6.5 per cent this fiscal. |
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| Meanwhile, with sale of single-premium policies not faring as they did last year, LIC is banking more on the sale of pension and unit-linked plans to make up for the shortfall. |
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| It wrote 1,67,60,234 individual policies with a sum assured of Rs 1,21,362.31 crore during the first 10 months of the fiscal. It mopped up a first-premium income of Rs 4,726.39 crore under individual plans. |
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| "We are confident of meeting the targeted sum-assured in view of the large-sized policies we are underwriting. Bima Plus (LIC's unit-linked plan) is picking up well and the average premium is far more than that in the case of individual plans," said Mathur. |
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