Page 16 - Insurance Times March 2024

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LIC employee unions refuse 'LIC's Amritbaal' designed to meet
expenses related to a child's higher Life insurers' stocks
14% salary hike education. The plan is an individual, surge on surrender
The employee unions of Life Insurance savings, life insurance plan specifically
Corporation of India (LIC) rejected the tailored to accumulate a corpus for charge talks
company's 14 per cent salary hike meeting the higher education and In a meeting with the regulator this
offer, saying it does not reflect the other needs of the child. week, chief executives of life
dedication and commitment of It offers guaranteed additions at the insurance companies made
workers towards the institution. representation on the cap on
rate of Rs 80 per thousand basic sum proposed surrender charges. The
The state-owned life insurer had assured at the end of each policy year
offered to give its employees a raise of from the inception till the end of the regulator is understood to have
14 per cent in a meeting convened policy term, provided the policy is in reassured them that their views
with All India National Life Insurance force. would be considered while framing
Employees Federation and other unions the final guidelines.
The plan has a minimum entry age of
in LIC. Shares of life insurance companies
0 years and a maximum entry age of have seen significant activity in the
According to a press note by the 13 years. The minimum age at
unions, "All the unions in LIC have maturity is 18 years, while the last two days. Industry sources
refused the 14 per cent offer of LIC maximum age at maturity is 25 years. attribute this to the prospect of
Management as this offer does not Short premium payment terms of 5, 6, proposed rules on surrender charges
reflect the dedication and or 7 years are available. The minimum being diluted. Analysts believe that
commitment of LIC employees towards policy term for limited premium capping surrender charges would
the institution." payment is 10 years and for single have an impact on the bottom line
of these companies.
Rajesh Nimbalkar, the General premium payment is 5 years.
Secretary of All India National Life HDFC Life gained 7.5% in the last
Insurance Employees Federation, LIC net up 49% to Rs. 9,444 two days, ICICI Pru Life and LIC were
noted that the offer made by the up over 5%, and SBI Life gained 4%.
management has "disappointed crore on higher premium While surrender charges are aimed
employees", considering the income at defraying the upfront costs of
performance of the public sector insurers and discouraging
The Life Insurance Corporation of India policyholders from exiting early, the
insurer across several parameters.
(LIC) reported a 49% growth in net flip side is that customers who have
profit at Rs 9,444 crore for the third been mis-sold lose out if they decide
LIC launches plan for quarter ended December 2023 to exit policies early. Share prices
child's higher studies (Q3FY24). also rose in anticipation of improved
LIC has introduced a new plan called The insurer had a net profit of Rs 6,334 growth in Jan 2024.

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