Page 10 - Insurance Times November 2019

16 arrested in LIC fraud LIC dispels financial downfall rumors

case, police recover Rs 37 While reiterating that it is in "sound financial health", LIC has recently released
a statement refuting rumors about its financial po-
lakh in Mohali sition. The insurer has responded to the rumors cir-
As many as 16 persons have been ar- culating on WhatsApp and other social media plat-
rested for forms regarding the alleged downfall of its wealth.
their in- "The messages wrongly speculate about LIC's finan-
volvement cial health and attempt to portray the largest life in-
in LIC fraud surer in poor light in the eyes of its stakeholders. These news are factually in-
case. Police correct, uncorroborated and intend to tarnish the image of LIC brand and also
arr e s t e d create panic in the minds of its policyholders," the statement read.
kingpin Kapil Kanav in the fraud case
that came to light in August this year. Further, LIC had asked policyholders not to take cognizance of such 'mislead-
ing' news. "LIC... would like to assure its policyholders about its sound finan-
Police have unearthed Rs 37.30 cial health...," the statement added.
lakh, 14 mobile phones, 3 fixed
wireless phones, 12 cheque books LIC had said that it has announced the highest ever bonus amounting to more
and a Fortuner car with registration than Rs 50,000 crore to its policyholders for FY18-19. Its market share as of
August 31, based on the number of policies is 72.84 percent and for the first-
number HR13J0077. A total of Rs 7
year premium is 73.06 percent.
lakh which was deposited in three
different accounts of the accused
have been frozen by the bank. No plans to go public, says LIC
"It is too early for the largest domestic life insurance company to go public,"
A FIR has been lodged by the Mohali
police under sections 420 (cheat- says MR Kumar, LIC Chairman. Kumar
further said that while the economy
ing), 406 (punishment for criminal is seeing a slowdown, life insurance
breach of trust) and 120 B (criminal
as a sector is doing well.
conspiracy) at Phase 11 police sta-
tion. Based on the complaint of “The potential is huge, and consoli-
Gurnam Singh, who was a former dation is still far away,” he said. LIC
employee of BSNL, police took ac- possessed total asset under manage-
tion. The police said the accused ment in excess of Rs 31 lakh crore as of July end. Kumar stated LIC has invested
were operating two call centres, one Rs 33,000 crore in equities this year.
in Kailash Nagar and the other in “The insurer has made Rs 13,000 crore profit on this. Last year, it made Rs
Laxmi Nagar in Delhi. 23,000 crore profit from equity,” he said.
“The kingpin, Kapil Kanav was the Kumar had said LIC is not worried about market movements, as it is a long-
mastermind behind this fraud. They term player. “As long as a scrip gives returns over 10-15 years, it is good
used different names to approach enough,” Kumar said his company does own research before investing and
people,” said Harmandeep Singh evaluates its portfolio once in a quarter.
Hans, superintendent of police (in- Kumar stated, "LIC has stakes and board seats in many companies but is not
vestigation). involved in running day-to-day operations of any. Bulk of LIC’s corpus is still
Deputy SP Rupinderdeep Kaur Sohi invested in debt," he said.
said, “After three accused were ar- “We have seen slowdown cycles before, and we shall ride over this one as well,”
rested on August 28, we received a he said. Kumar states, "His company plans to add 16,000 officers but does not
six more complaints regarding LIC have plans to add branches. LIC is integrating smaller branches with IDBI Bank
fraud from Mohali. They had formed branches and is going digital fast to seek technology-led business growth via
different teams to crack the case. new products."
The scam started seven years back “People have so far preferred buying LIC’s term and endowment products,”
in 2012. It is a long trail and the case Kumar said, adding that his company has consciously stayed away from Ulips,
is not yet completed.”
but will gradually start adding them.
10 The Insurance Times, November 2019