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Insurance

Life Insurance Corporation of India

The Life Insurance Corporation of India (LIC) - External website that opens in a new window with its central office in Mumbai and seven Zonal Offices at Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Kanpur and Bhopal operates through 101 divisional Offices including one Salary Savings Scheme (SSS) Division at Mumbai and 2048 branch offices. As on 31 March 2006, LIC has 10, 52,283 agents spread all over the country. The Corporation also transacts business abroad and has offices in Fiji, Mauritius and United Kingdom. An overseas subsidiary of the Corporation namely Life Insurance Corporation (International) E.C. Bahrain was established in 1989. LIC is associated with joint ventures abroad in the field of insurance, namely, Ken- India Assurance Company Limited, Nairobi, a registered joint venture company in Kathmandu, Nepal by the name of Life Insurance Corporation (Nepal) Limited in collaboration with Vishal Group Limited, a local industrial Group. LIC (Lanka) Ltd., the latest joint venture subsidiary of the Corporation was established in Sri Lanka on 1 March 2003 in partnership with local company M/s Bartleet & Company Ltd. An off-shore company LIC (Mauritius) off-shore Limited was registered to tap the African insurance market.

During 2005-06, the total new business under Individual Assurances was Rs.2,87,530.24 crore under 315.73 lakh policies. The Group Insurance business during the year 2005-06 brought new business premium of Rs.3,919.01 crore under 11,845 schemes covering 51.27 lakh people. The sum assured in respect of conventional Group Insurance Business is Rs.25,216.88 crore. In addition, LIC sold 19, 48,025 new individual pension policies including Future Plus.

The Life Fund of LIC as on 31 March 2006 as per the provisional results amounts to Rs.4, 63,147.62 crore. During 2005-06 the Corporation made payments of Rs.3769.04 crore under Death Claim cases, Rs.24743.42 crore under Maturity Claims and Rs.1977.54 crore under annuities.

Under Varishtha Pension Bima Yojana the Corporation made payments of Rs.75.47 crore under Death Claim cases and Rs.656.08 crore under annuities.

Social Security Group Insurance Scheme

A Social Security Fund (SSF) was set up in 1988-89 for providing social security through Group Insurance Scheme to the weaker and vulnerable sections of the society. The SSF is administered by LIC for meeting insurance requirements of the segment.

People belonging to 24 occupational groups/areas have been covered under this scheme. The scheme has been replaced by Janshree Bima Yojana from August 2000. But the renewal of the groups covered earlier is permitted.

Janashree Bima Yojana

The Janashree Bima Yojana was launched on 10 August 2000. The Scheme has replaced Social Security Group Insurance Scheme (SSGIS) and Rural Group Life Insurance Scheme (RGLIS).

The Scheme provides for an insurance cover of Rs.20,000 on natural death. On death/total permanent disability due to accident, the benefit is Rs.50,000 increased to Rs.75,000 w.e.f. 15 August 2006. On partial permanent disability due to accident, the benefit is Rs.25,000 increased to Rs.37,500 w.e.f 15 August 2006. The premium for the scheme is Rs.200 per member. 50 per cent premium under the scheme will be met out of Social Security Fund. The balance premium is to be borne by the member and/or Nodal Agency. As on 31 March 2006 about 39.87 lakh have been covered. The balance in Social Security Fund as on 31 March 2006 is Rs.808 crore.

Krishi Shramik Samajik Suraksha Yojana

The multi-benefit scheme for the agricultural workers, commenced on 1 July 2001, provides life insurance protection, periodical lump sum survival benefit and pension to those who were between the ages of 18-50 years. Minimum membership of the group at commencement should be 20. Gram Panchayat was to act as nodal agency and with the help of NGO/SHG or any other agency, would identify the agricultural workers.

As on 31 March 2006, 29,074 agricultural workers have been covered. Sale of new policies discontinued from December 2003. No new lives are to be added even under existing schemes at the time of renewal.

Shiksha Sahayog Yojana

The scheme was launched on 31 December 2001, with the object to lessen the burden of parents in meeting the educational expenses of their children. It provides scholarships to students of parents living below or marginally above poverty line and who are covered under Janashree Bima Yojana and are studying in 9th to 12th standard (including ITI courses) A scholarship amount of Rs.300 per quarter per child is paid for a maximum period of four years and for maximum two children of a member covered under Janashree Bima Yojana. No premium is charged for this benefit. As on 31st March 2006, scholarships were disbursed to 3, 20,253 beneficiaries.

General Insurance Corporation of India

The General Insurance Corporation of India (GIC) - External website that opens in a new window was approved as the "Indian Reinsurer" on 3 November 2000. As the "Indian Reinsurer" GIC has been giving reinsurance support to four public sector and other private general Insurance Companies. The Corporation has commenced full-fledged life reinsurance operations from 1 April 2003. It continues its role as a reinsurance facilitator by managing marine hull pool and terrorism pool on behalf of India Insurance industry. The reinsurance programme of GIC aims at optimising the retention within the country and developing adequate reinsurance capacity.

During the year, the Corporation continued to offer maximum support for all classes of business to the Indian insurers. It has availed a new cover, the Peak Risk Facility, thereby increasing the PML capacity to Rs.3,000 crore from Rs.1,500 crore. The capacity of terrorism pool managed by GIC has increased to Rs.500 crore from 1 April 2005 from the earlier limit of Rs.300 crore. The GIC continues to lead the reinsurance programme of the companies in Maldives, Kenya, Malaysia, Mauritius, Middle-East, Africa and Sri Lanka. In the process, it has emerged as a preferred re-insurer in the Afro-Asian region. During the year 2005-06, the net premium income of the Corporation has grown to Rs.4,234,88 crore as against Rs.4,614.87 crore in the previous year. The net incurred claims were at Rs.4,573.07 crore, i.e., 107.98 per cent as against Rs.3702.80 crore in the previous year, i.e., 80.25 per cent. Profit before tax was Rs.442.94 crore as on 31 March 2006 compared to Rs.800.08 crore as on 31 March 2005. The Corporation has recorded a profit after tax of Rs.598.52 crore as against Rs.200.02 crore in the previous year. The total assets and networth have grown to Rs.26,424.03 crore and Rs.4,759.13 crore respectively as on 31 March 2006.

The Corporation has its presence in foreign reinsurance business through its representative offices at London and Moscow. Apart from reinsurance business, GIC continues to participate in the share capital of Kenindia Insurance Company Ltd., Kenya and India International Insurance Pvt. Ltd., Singapore. The Corporation has subscribed to 30 per cent of the holdings in the initial share capital of LIC (Mauritius) Offshore Ltd., a joint venture Company promoted by LIC of India in Mauritius.

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Source: National Portal Content Management Team, Reviewed on: 11-01-2011