Page 11 - The Insurance Times January 2022

RBI allows LIC to raise During 2020-21, the LIC's long-term in- 2.01% stake of Bharat Petroleum Cor-
vestment holding in equity saw a mas- poration from 11 June 2018 to 28 De-
holding in IndusInd Bank sive jump to Rs. 5.94 lakh crore from cember 2021.

to 10% Rs. 3.31 lakh crore as of end of March Post transaction, Life Insurance Corpo-
2020.
Reserve Bank of India (RBI) has ap- ration of India (LIC) increased its
proved the largest insurer in India Life LIC, which is expected to hit the capital shareholding to 15,25,08,269 equity
Insurance Corporation to raise its stake market with an IPO in the fourth quar- shares or 7.03% stake from
in Indusind Bank to up to 9.99 per cent. ter this fiscal, is now capitalised at Rs. 10,87,05,479 equity shares or 5.011%
10,000 crore, with the entire holding stake held in Bharat Petroleum Corpo-
"We are pleased to inform you that the
Bank has received an intimation from by the government. The Reserves and ration. The deal was executed as mar-
the RBI on December 9, 2021, that it Surplus of LIC as of end March 2021 stood ket purchase.
at whopping Rs. 5.94 lakh crore.
has granted its approval to Life Insur- As of 30 September 2021, Life Insurance
ance Corporation (LIC) to acquire up to In financial year 2020-21, the total first Corporation (LIC) of India held 5.66%
9.99 per cent of the total issued and year premium of life insurers increased stake while the Government of India
paid-up capital of the bank," said by 7.49 per cent to Rs. 2,78,278 crore held 52.98% stake in the PSU OMC.
IndusInd Bank in a regulatory exchange as compared to Rs. 2,58,897 crore in
filing. the previous fiscal. The number of new Embedded value of LIC
policies declined by 2.49 per cent to 2.82
LIC already holds a 4.59 per cent stake crore in 2020-21 from 2.89 crore in the likely at $150 billion
in the bank. An actuarial valuation exercise has ar-
previous fiscal.
rived at a $150 billion embedded value
LIC investment income The market share of LIC stood at 66.18 for Life Insurance Corp. of India, the first
per cent in total first year premium and such valuation done by India's largest
grows by a robust 16.66% 74.58 per cent in the number of new insurer, which is set to start road shows
in FY21 policies as of March 31, 2021. LIC re- for its initial share sale, two people
ported a slight increase of 0.8 per cent
LIC recorded a robust 16.66 per cent aware of the development said
increase in income from investments on its Group New Business Premium in India's largest insurer has also initiated
2020-21 to over Rs. 1.28 lakh crore from
(including capital gains) in financial year talks with several foreign investors, in-
Rs. 1.27 lakh crore in the previous fi-
2020-21 at Rs. 2.73 lakh crore (Rs. 2.34 nancial year. cluding pension funds, to join as anchor
lakh crore), its annual report for 2020- investors in its initial public offering, the
21 showed. people said.
LIC acquires 2% stake in
Total premium income of LIC grew 6.33 Anchor investors are typically financial
per cent to Rs. 4.03 lakh crore in 2020- BPCL institutions that are allotted shares in a
21 as compared to Rs. 3.79 lakh crore Life Insurance Corporation of India (LIC) company ahead of the public offering
in the previous year. bought 4,38,02,790 equity shares or on a discretionary basis. T

Motor insurance in Asia-Pacific to grow

The motor insurance industry in Asia-Pacific (APAC) is projected to grow from $226.0bn in 2020 to $294.2bn in 2025,
in terms of written premiums.
A report reveals that the motor insurance industry in Asia-Pacific will grow at a compound annual growth rate (CAGR)
of 5.4% over 2020-2025, supported by the recovery in new vehicle sales and product innovation in motor insurance.
Recovery in vehicle sales in 2021 is mainly driven by growing sales of electric vehicles (EV) as many economies aim
to phase out internal combustion engine vehicles as part of their climate goals. For instance, Singapore aims to
phase out diesel-powered vehicles by 2025, as a result, EV sales rose by over 80% during January-September 2021.
Insurers are also focusing on product innovation to drive sales. Pay-as-you-go and short-term car insurance are ex-
amples of products that gained traction during the lockdown as demand for customized motor insurance surged
particularly from ride-share services providers such as Uber, Tada (South Korea), and Ola (India).

The Insurance Times, January 2022 11