• Source:PTI

LIC:  Siddhartha Mohanty, chairman of LIC, said that the insurer would enter the health insurance segment and may explore inorganic options if such an opportunity arises. There are expectations that composite licenses may be allowed by amending the Insurance Act. Under the Insurance Act, 1938 and the regulations of the Insurance Regulatory Development Authority of India (IRDAI), composite licensing for an insurer to undertake life, general, or health insurance under one entity is not permitted.

He stated that LIC is not an expert in general insurance like fire and engineering but it can provide health insurance while sharing financial numbers for FY24. The chairman added that internal work is in progress, and we will explore inorganic growth in health insurance.

In February, a parliamentary panel recommended the introduction of a composite license for an insurer to undertake life, general, or health insurance under one entity to increase the penetration of insurance in the country. BJP leader Jayant Sinha headed the committee, which recommended the government to introduce a provision of composite licensing for insurance companies and make the related amendment in legislation at the earliest.

Also read: ITR Filling: Income Tax Department Reminds Taxpayers To Link PAN With Aadhaar By May 31 To Avoid Higher TDS Deduction

The report observed that allowing composite licensing could provide further impetus to the insurance sector, due to its several benefits, and that it could reduce costs and compliance hassles for insurers, as they can run different insurance lines under one roof. The report tabled in Parliament also stated that it can provide customers with more options and value, such as a single policy that covers life, health, and savings.

It can boost insurance reach and awareness in India as customers can obtain one insurance from one provider with lower premiums and easier claims.

The committee is aware that to enable composite licensing in India, the government and the IRDAI are planning to make amendments to the existing insurance legislation, it stated. In the meantime, insurance behemoth LIC posted a marginal 2% increase in net profit to Rs 13,763 crore in the fourth quarter ended March 2024, as the corporation made provisions for wage increases. The insurer had earned a profit of Rs 13,428 crore in the corresponding quarter a year ago.

During the reporting quarter, the insurer's total income increased to Rs 2,50,923 crore from Rs 2,00,185 crore in the same period of the preceding fiscal. In the latest January-March quarter, LIC's first-year premium income also increased to Rs 13,810 crore, up from Rs 12,811 crore in the same period of the preceding fiscal.

The income from renewal premiums in the reporting period rose to Rs 77,368 crore, compared to Rs 76,009 crore a year ago.During the entire fiscal year ended March 2024, the insurer earned a profit of Rs 40,676 crore, up from Rs 36,397 crore in the previous fiscal. The total premium income for the year ended March 2024 was Rs 4,75,070 crore, compared to Rs 4,74,005 crore in the year ended March 2023. A total of 2,03,92,973 policies were sold in the individual segment in FY24, compared to 2,04,28,937 policies sold in the previous fiscal.

Mohanty said that the board has recommended a final dividend of Rs 6 per share for 2023-24, subject to shareholders' approval. Earlier, during the year, an interim dividend of Rs 4 was declared and paid to the corporation's shareholders. Therefore, he said, the total interim and recommended final dividend aggregates to Rs 10 per share.

(With PTI's Input)

Also Read: Adani Enterprises Board Approves Rs 16,600 Crore Fund Raise; Details

Also In News