In a concise statement, the chairperson of LIC emphasizes the company’s commitment to achieving its desired product and channel mix, with full support from all employees, the agency force, and channel partners.
Life Insurance Corporation of India (LIC) announced a significant 49% increase in its net profit for the third quarter, attributed to a strategic shift of funds into shareholders’ funds to bolster its financial performance.
Standalone net profit surged to Rs 9,444 crore for the quarter ending December 31, compared to Rs 6,334 crore in the corresponding period last year.
Siddhartha Mohanty, Chairperson of LIC, expressed satisfaction with the company’s focused strategy in diversifying and altering its product mix, which is yielding quicker results. He highlighted the increase in the share of Non-Par business to 14.04% of the total individual business for the first nine months of FY 2024, alongside a 200 basis points increase in the Value of New Business (VNB) margin levels to 16.6%. Mohanty emphasized that these outcomes reflect the successful implementation of strategic interventions as envisioned by the company.
We are dedicated to ensuring that every decision we make adds value for all stakeholders. With the unwavering support of our employees, agency force, and channel partners, we will persistently pursue our targeted product and channel mix. Our commitment extends to developing innovative products tailored to meet the changing needs of our customers. As we embark on our digital transformation journey, we anticipate substantial enhancements in our business processes.
The PSU insurer’s board has approved an interim dividend of Rs 4 per share. On Thursday, LIC’s stock on BSE closed trading 6.5% higher at Rs 1,112. The company transferred Rs 7,692 crore from its non-participating fund to a shareholders’ fund for the quarter, compared to Rs 5,670 crore in the same quarter last year. The premiums collected by LIC from ‘non-participating’ policies, which offer fixed returns, are typically allocated to a non-participating fund.
Since 2022, LIC has been regularly transferring portions of its non-participating fund to its shareholders’ fund each quarter, contributing to its profitability.
These transfers have been aimed at strengthening its solvency margin, which represents the insurer’s ability to fulfill its long-term debt obligations. In the third quarter, LIC’s solvency ratio improved to 1.93 from 1.85 a year earlier, indicating a positive trend in its financial stability and risk management.
LIC’s net premium income witnessed a robust increase of nearly 4.6%, driven by a significant uptick in its total premium for December, which nearly doubled year-over-year. This growth comes after experiencing declines in premium in the preceding two months, showcasing a notable rebound in the company’s premium performance.
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