The Telegraph
Since 1st March, 1999
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LIC targets 20% growth in income

New Delhi, Jan. 22 (PTI): Life Insurance Corporation (LIC) today expressed confidence of attaining over 20 per cent growth in income at Rs 90,000 crore this fiscal and hinted at withdrawing some high assured return policies if interest rates dipped further.

“We have targeted Rs 90,000 crore income this fiscal as against Rs 73,800 crore last fiscal...We expect first premium income to grow by over 40 per cent during 2002-03,” LIC chairman S.B. Mathur said on the sidelines of a Ficci seminar on insurance.

If the impressive growth continues, LIC’s assets would cross the Rs 3,00,000-crore mark this fiscal compared with Rs 2,40,000 crore last fiscal, he said.

Last fiscal, LIC’s first premium income grew by a whopping 137 per cent to Rs 14,843 crore. This year, the insurance monolith expects it to cross Rs 20,000 crore. “In the first quarter of this fiscal, the sale of high value policies showed some decline due to the uncertainty over service tax on insurance. But it has picked up. We are well above target,” Mathur said.

Sales of high value policies of Rs 1 crore and above were growing by 27 per cent till December, he said, adding LIC has so far sold about 30 policies for an average premium of Rs 10 crore as well. “We sold one policy for a premium of Rs 51 crore,” he said.

Asked whether the insurer was considering withdrawal of its new Jeeven Shree product, Mathur said “it is under watch. If interest rate falls, then we might think of withdrawing it.” Same thing applies for other assured single premium policies.

“We might withdraw some policies and launch some other policies,” Mathur said, adding LIC was considering more profit-sharing products in the coming months.

LIC, which has 96 per cent market share in life insurance business, has plans to launch an awareness drive to boost sales while increasing its agent network.

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