LIC signs up Axis Bank as bancassurance partner

In preliminary phase, bank will distribute LIC's life insurance products across its branches

India's largest insurer Life Insurance Corporation of India (LIC) has signed an agreement with private sector lender Axis Bank as its bancassurance partner wherein the bank will distribute LIC's products to its customers.

In the preliminary phase, the bank will distribute LIC’s life insurance products across its branches in West Bengal, Bangalore and Haryana – Panchkula. Additionally, the bank will also provide post sales services such as premium collection and renewal of policies.

In a statement, LIC said that this is one of the largest bancassurance partnerships after the recent Insurance Regulatory and Development Authority of India (IRDAI) regulations issued on open architecture framework for banks.  As on June 30, 2016, Axis Bank had a network of 3,006 domestic branches and extension counters situated in 1,882 centres. 

Mukesh Gupta, Executive Director, Bancassurance, LIC said that the coming together of the two major reputed organisations would enable them to combine and utilise the synergies for enhancing customer satisfaction and for serving social objectives of the nation.

From April 1, norms have been revised under which corporate agents like banks are allowed to tie-up with three life, three non-life and three standalone health insurance companies. Earlier, the bancassurance model where banks sold insurance meant that they could only sell products of one life, one non-life and one standalone health insurer. Apart from LIC, Axis Bank also has a tie-up with Max Life Insurance in the life insurance space.

Rajiv Anand, Executive Director & Head Retail Banking, Axis Bank said that banks have increased their role in insurance distribution with bancassurance being the biggest contributor.

"Over the last five years the Life Insurance business at Axis Bank has grown at a CAGR of over 25 per cent. The partnership with LIC would enable us to further expand our existing bouquet of offerings and put forth a compelling proposition for our customers," he said.