Friday, October 9, 2009
LIC eyes Rs14 trillion asset size in three years
LIC eyes Rs14 trillion
asset size in three
years
The firm expects its asset size to grow by
about Rs6,00,000 crore or 75% in next three
years
New Delhi: Looking to capitalise on its vast network of insurance agents,
growing by lakhs every year, country’s top life insurer LIC expects its asset
size to grow by about Rs6,00,000 crore or 75% in next three years.
This will take the company’s asset base, already highest in the country, to
between Rs13,00,000-14,00,000 crore in the three years’ time, Life
Insurance Corporation chairman TS Vijayan told PTI.
“We are number one in financial terms with Rs8,00,000 crore of assets.
Nobody else comes even close ... even banks don’t have Rs8,00,000 crore
(assets),” he said.
Asked where he sees the company in the next three years, Vijayan said: “In
three years, LIC should be handling anywhere between Rs13-14 lakh crore.”
Set up in 1956, the government-run life insurance major had about
Rs8,00,000 crore of assets at the end of last fiscal, or as on 31 March 2008.
To meet this target, LIC is planning to nearly double its field workforce of
agents by March 2011, from about Rs11,93,000 as on March 2008.
“(In) three years, we want to double the number of agents,” he said,
adding, “last year, we ended with 11 lakh plus agents and we would like to
increase it by a minimum 25% by March, 2009. This is a target we have
taken ourselves and I think we will be able to do it.”
During the current fiscal, LIC has already recruited about two lakh insurance
agents across the country, which is more than double of about 90,000
agents hired in the previous fiscal.
Besides, LIC has also hired 4,500 development officers so far in the current
fiscal and up to 5,000 new officers could be hired in the next fiscal, he
noted.
Currently, LIC has about 24,000 development officers across the country. At
the end of last fiscal, the insurer had more than one lakh employees on its
payrolls, which includes development officers.
Asked whether recruitment of high-profile agents by a private insurer deters
the insurance giant, Vijayan said, “We also have a large number of highprofile
agents... They usually operate in their own circle.”
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However, these high profile agents bring good business to the company, he
added.
Private insurance companies have also been aggressively expanding their
network in the recent past, but their hiring plans still pale before that of the
public sector giant.
Among the private players, Reliance Life Insurance has announced plans to
hire over 90,000 agents and about 2,500 managers, while Max New York
Life and Metlife have previously announced hiring plans for over 30,000
agents in the current fiscal.
Vijayan said that LIC was also planning to elevate the status of their agents
akin to bank business correspondent.
“Bank are now having banking correspondents we would like to elevate the
status of agents to that of correspondents who can collect premium,” he
said.
LIC posts 83 per cent growth in new business premium in August
| LIC posts 83 per cent growth in new business premium in August | |
| | |
| | |
| | |
| MUMBAI: The premium collection of the life insurance industry grew by around 44 per cent to Rs 9,044.18 crore in August this year as against Rs
6,273.57 crore in the same period last year, according to IRDA data. The private life insurance segment, however, witnessed a negative growth of around 8 per cent while the LifeInsurance Corporation of LIC garnered a premium of Rs 6,544.99 crore in August this year as against Rs 3,562.93 crore in the corresponding period of the previous year, the data said. Premium collection of private life insurers stood at Rs 2,499.20 crore during the month as compared to Rs 2,710.65 crore in August 2008. Among private life insurers, I Bajaj Allianz Life's premium collection was Rs 289.57 crore during the month under review, down by 25 per cent, as against Rs 389.73 crore in the year-ago period. | |
Term plan - the most essential life insurance plan
Term plan - the most essential life insurance plan
How many you have? The Most Essential Life Insurance Plan and why you SHOULD have it.
Have we all met our favorite life insurance agent selling to us insurance plans for our children, for our retirement, for our parents, for our house and so on and so forth? Oh Yes, of course. Have any of the agents suggested a plan called as a term plan to you? If your answer is NO, its time you looked for somebody else for your insurance requirements.
What is it? And…
Why is the term plan so important? Because, it is the most basic of all plans. Term plans are products which are plain vanilla (no frills/bread) that give us very high life covers for very low premiums. But term plans do not give any thing back at the end of the term (life cover period) if you outlive it. Agents / sales persons de-sell these plans using this feature to tempt us to high premium plans that do give us something back. However, term plans are able to give us high covers exactly because of this feature.
Most of the other insurance plans are built around the Term Plans or have the term plans as a part of them. As the features get added, the premium also increases. But many times the premium increase is very steep as the commission (to the agent) and company charges increase as a percentage of the premium. This increases the premium rapidly in value terms. Let me explain with an example: 10% on Rs.100/- is Rs.10 which most of us could afford. The same 10% on Rs.20,000/- is Rs.2,000/- which is a big amount for most of us.
Insurance Buying Scenarios
Since most of the agents / sales persons are taught to sell the cream (not the bread), we end up among any of the 3 following scenarios:
1. Take an insurance plan that we need but at premiums that we could not afford
2. Take a plan that we do not really need
3. Do not take any plan; effectively postponing a need.
The fourth possible scenario is to ask the sales person for a term plan.
Premium Amount Comparison
Let us compare term plans with one other product which also does not give anything back at the end of the term - Vehicle Insurance. Though the basic features and coverage are different, I have found that the perspective got from the comparison is an eye opener for my clients and my training participants.
The two wheeler full cover (third party + owner accident cover for Rs.1,00,000/-) insurance premium for a vehicle with Rs.35,000/- vehicle value will come to about Rs.900/- per year.
A four wheeler full cover insurance premium for a vehicle with over 1500 CC engine capacity and current value of Rs.10,00,000/- (Rs. Ten Lakhs) will cost about Rs.28,000/- per year. (Less than 1500CC engine capacity will set us back by about Rs.25,000/- per year.)
Compare that with the premium for a life cover of Rs.10,00,000 (Rupees Ten Lakhs only) for a 35 year old male. The premium here will come to only about Rs.4,300/- per year.
Perspective Compared to Vehicle Insurance
See the difference in rates? I do take up insurance for my vehicle because it is mandatory and the traffic police man at the next corner may charge me for not having one. And anyway I don’t get the premium back, unless there is an accident.
But for my own life, I don’t take up a term plan (which costs only 17% that of my vehicle) because the plan does not give anything back??? Common sense, where art thou? Do we love our car and bikes more than our family members??? Or is it that we are so used to the police man at the next corner that we have forgotten to think?
Jai Ho Term Plans
All life insurance companies in India
There is no monetary value for peace of mind. For everything else do take a term insurance cover.
Tuesday, October 6, 2009
Me
I am a member of chairman club, LIC. Also I am a member of LUGI. I would like to post here details of latest information on INSURANCE Industry.
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