LIC to ramp up bancassurance channel

Life Insurance coverage Company of India (LIC) is trying to ramp up its bancassurance channel by growing the share to 8-10 per cent of its whole premium within the subsequent 4-5 years. Bancassurance presently accounts for 3.6 per cent of the full premium.

In accordance with data out there within the draft pink herring prospectus filed by LIC, for the 9 months interval ended December 31, 2021, the bancassurance and alternate channels collected a brand new enterprise revenue (NBP) of round ₹917 crore accounting for near 2.56 per cent of whole gross sales. Particular person brokers collected new enterprise premium of round ₹34,464 crore, accounting for somewhat over 96 per cent.  

“We can be trying to focus extra on bancassurance transferring ahead,” Siddhartha Mohanty, Managing Director, LIC informed BusinessLine on the sidelines of its IPO press convention right here on Friday.

LIC follows an omnichannel distribution platform for particular person merchandise comprising particular person brokers, bancassurance companions, alternate channels (company brokers, brokers and insurance coverage advertising corporations), digital gross sales (via a portal on the company’s web site) and micro-insurance brokers amongst others.

It has the most important particular person agent community amongst life insurance coverage entities in India, comprising roughly 1.33 million particular person brokers as at December 31, 2021, which was 6.8 occasions the variety of particular person brokers of the second-largest life insurer.

A number of companions

LIC presently has 70 bancassurance companions, comprising of eight public sector banks (Central Financial institution of India, Union Financial institution of India, Indian Abroad Financial institution, Punjab Nationwide Financial institution, Financial institution of Maharashtra, Indian Financial institution, Punjab & Sind Financial institution and UCO Financial institution); 5 non-public sector banks (Karnataka Financial institution, Tamilnad Mercantile Financial institution Restricted, Axis Financial institution, Metropolis Union Financial institution and IDBI Financial institution); one overseas financial institution; 14 regional rural banks; and 42 co-operative banks.

“(We’ll have a look at) growing our market share of the bancassurance channel by tying up with extra financial institution companions and enhancing their productiveness by offering them with digital options for on-boarding prospects for our merchandise,” LIC stated within the DRHP.

LIC had a market share of round 62 per cent when it comes to premiums or gross written premium, round 61 per cent when it comes to new enterprise premium, 72 per cent when it comes to the variety of particular person insurance policies issued, and 89 per cent when it comes to the variety of group insurance policies issued, for the 9 months ended December 31, 2021.

For the general Indian market, the share of latest enterprise generated for particular person life insurance coverage via bancassurance channels elevated from 24 per cent in FY2016 to 29 per cent in FY2021. Non-public gamers have a comparatively greater dependence on bancassurance for brand spanking new enterprise, with their share growing from 52 per cent in FY2016 to 55 per cent in FY2021.

“Whereas the company channel will stay the bedrock of distribution for many life insurers, with accelerated digital adoption and technological developments, life insurers within the subsequent few years will deal with enhancing productiveness and effectivity by focusing utilizing an omnichannel technique, and leveraging each digital and bodily gross sales strategies,” it stated within the DRHP.


The proposed maiden public supply by state-owned LIC has obtained curiosity from greater than 25 anchor traders each overseas and home, an official stated. The anchor e-book can be opened on Might 2.

Almost 50 per cent of the supply is reserved for QIPs, together with anchor traders, whereas retail traders’ share can be round 35 per cent of the web challenge, one other 15 per cent for top web value people and ten per cent for policyholders.

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April 30, 2022

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