Financial Daily from THE HINDU group of publications
Sunday, Jul 24, 2005
Money & Banking - Life Insurance
LIC targets 100 pc growth in unit-linked plans
Mr A.K.Shukla, Chairman
Mumbai , July 23
LIFE Insurance Corporation of India expects its unit-linked insurance plans to grow 100 per cent this fiscal, the LIC Chairman, Mr A.K Shukla, told Business Line.
Last year, over 35 per cent of LIC's first premium business came from two of its unit-linked plans (ULIPs). Bima Plus brought in Rs 2,183.5 crore and Future Plus, the unit-linked pension plan, brought in Rs 2,107.75 crore.
"Last year, ULIPs accounted for 7.19 per cent of our sales and we sold about 20 lakh policies. So, selling 40 lakh policies this year is not a tall order for us," said Mr Shukla.
The average premium per policy for ULIPs was much higher than the other traditional products. Mr Shukla said, "ULIPs have an average premium of about Rs 18,000 while for the other products it is just about Rs 3,000."
Mr Shukla, who recently took over as Chairman of LIC, has projected a growth of 38 per cent in terms of all policies and a 50-per cent growth in new business premium. LIC had declared a first premium income of Rs 15,840 crore in 2004-05, a growth of 30 per cent from the previous fiscal.
"This year our projection for growth in new business premium is 50 per cent. This is because we are receiving more premium from the urban areas, particularly from ULIPs," he said.
To meet the goal of 100 per cent growth in ULIPs, LIC will be introducing another unit-linked product called Jeevan Plus this year. This product will have a life insurance component as well.
The corporation will also be coming out with an innovative insurance policy to mark the corporation's golden jubilee year. LIC would be entering its 50th year in September 2005 and the new product would be launched later this year, he said. LIC will also be launching another product mainly targeting people in the rural areas whose income is seasonal. This product will allow people in the rural areas to use their seasonal savings without having any sort of annual commitment to pay a premium.
Mr Shukla explains, "We had certain restrictions in our existing products for rural areas. Currently, the products designed for the rural areas are supposed to have a minimum of Rs 30,000 as sum assured. This new product will allow people to deposit, for instance, Rs 5,000 as a single deposit."
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line