Page 37 - Life Insurance Today January 2018
P. 37

LIC premium income increases 12% at Rs 1.48 trillion                   LIC to to stop sale of

         Total premium income at Life Insurance Corporation rose around 12% in the  Jeevan Akshay
                                  six months ended September to Rs.1.48 trillion.
                                  Total net income during the period rose 12.6% to  Life Insurance Corporation of India
                                  Rs2.50 trillion. LIC, India's largest institutional in-              will stop
                                  vestor, booked Rs.12,374 crore profit from the                       selling
                                  sale of equities during the period, up 16.3% from                    t  h   e
                                  a year before, as the market scaled record highs.                    popular
                                                                                                       annuity

         LIC told to pay premium with interest after policy holder                                     product
                                                                                                       Jeev a n
         declared dead by court                                                 Akshay from next month, as falling
         Taking serious note of a complaint wherein the complainant had asked the Life  interest rates has made it impossible
         Insurance Corporation (LIC) to release the claim amount                to sustain returns at the current
         against a policy but her application was rejected, the Con-            level. It may, however, reintroduce
         sumer Forum has now directed LIC to pay the premium                    the plan by offering a lower rate, a
         along with 9 per cent interest from the date the letter                senior executive said.
         was rejected by the corporation.                                       Jeevan Akshay had been best selling

         Promila Kumari, in her complaint to the Forum had stated               plan of LIC, generating close to a
         that her husband, Narinder Kumar, had taken a life insur-              fourth of its new business income.
         ance policy of Rs 1 lakh from LIC for 20 years on March                The single-premium plan contrib-
         28,1999. The premium of Rs 584 per month, payable by                   uted Rs 10,000 crore  to LIC's
         the 28th of every month was deducted from the policy holder's salary. The last  revenue so far this financial year
         premium was paid on April 2001 and the policy was to get matured on March  and Rs 22,000 crore for the past two
         31, 2019.                                                              years.

         Meanwhile, Kumar went missing on March 19,2001 and a FIR was lodged by  The scheme that offers a regular in-
         Promila on March 22, 2001. Kumar was later declared dead by the court on  come is currently paying a yield of
         November 5, 2011. The complainant then served a legal notice on February  7.5 per cent. LIC has seen massive
         25, 2016, to release the amount against the policy, but LIC rejected it on the  inflows into this product, which of-
         ground that the policy was lying in a lapsed condition nothing is payable. She  fers returns that are half a percent-
         then moved the Consumer Forum and filed a formal complaint.            age points more than the 10-year
                                                                                government securities.
         In reply, LIC stated that the premium was deducted from the salary of the policy
         holder upto April 2001 and the policy remained in a lapsed condition for non-  "We have decided to discontinue
         payment of the premium at the time of death, i.e till January 2014 and, there-  with the high interest rate of 7.5 per
         fore, nothing is payable as per the terms and conditions of the Insurance Policy.  cent from December 1," said the
         The Forum then directed LIC to pay the premium of the policy along with 9  senior LIC executive. The executive
         per cent interest from the date of the rejection letter, ie. November 23, 2011  said it would file for a revised plan
         till its realisation.                                                  having a lower interest rate of 6-6.5
                                                                                per cent with the Insurance Regula-
         LIC launches Jeevan Shiromani plan for HNIs                            tor and Development Authority of
                                                                                India.
         Life Insurance Corporation (LIC) launched 'LIC's Jeevan Shiromani', a non-linked,
                            with profit, limited premium payment money back life  Single-premium guaranteed prod-
                            insurance plan especially designed for the high net-worth  ucts help insurers boost revenue.
                            individuals segment. According to LIC statement, mini-  But with the yield on the 10-year
                            mum basic sum assured under the plan is Rs 1 crore with  government bond at around 7.05
                            no upper limit. The plan is available for ages from 18 to  per cent, offering a high return has
         55 years. It provides for financial support for the family not only in case of death  become difficult since the insurer
         of life assured during the policy term but also provides for payment of a lump  also incurs costs such as on policy
         sum amount on diagnosis of any of the specified critical illnesses.    administration and acquisition.

         Life Insurance Today                         January 2018                                            37







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