LIC delivers strong Q2 performance, IDBI Bank disinvestment unlikely to hit bancassurance: CEO

New Delhi: State-owned Life Insurance Corporation of India (LIC) has delivered a strong performance in the second quarter and first half of FY27 with healthy growth in new business premium, total premium income and other key financial parameters, said Managing Director and CEO R Doraiswamy.

In an interview with IANS, Doraiswamy said that the company’s Value of New Business (VNB) margin also improved compared to the previous year.

He said recent volatility in equity markets and pressure on valuations of equity-linked investment instruments had affected sales of market-linked insurance products, particularly Unit Linked Insurance Plans (ULIPs).

Investor interest in regular-premium market-linked products had moderated, leading to a decline in ULIP sales during the second quarter.

However, the decline was not entirely market-driven as LIC had also made strategic changes at the management level to focus more on higher-ticket ULIPs and protection business, he added.

With market sentiment expected to improve, the company is hopeful of better performance in the current and coming quarters.

On the improvement in VNB margin, Doraiswamy said changes in product mix and better operational efficiency were the key drivers.

“Several positive changes have taken place at the operational level, which have directly contributed to profitability. While there were some adverse effects related to risk-free interest rates, overall, the company managed to record better margins,” he told IANS.

On proposed regulatory changes in insurance distribution and a possible cap on distribution costs, he said the Insurance Regulatory and Development Authority of India’s (IRDAI) initiative would benefit both policyholders and the industry in the long run.

LIC is already within the proposed limits for most product categories, while it has submitted suggestions to the regulator on certain products and premium payment terms, he said, expressing confidence that the regulator would consider feedback from stakeholders.

On the role of agents, Doraiswami said LIC views its individual agent network as long-term partners rather than merely a distribution channel.

In addition, the company is working to improve its productivity, training and capacity building, particularly in Tier-2 and Tier-3 cities.

Responding to a question on the proposed strategic disinvestment of IDBI Bank, he said it was unlikely to have any major impact on LIC’s bancassurance business.

“IDBI Bank has been a key partner of LIC for a long time, and we expect this partnership to continue in the future, even as the bank has other life insurance partners,” he said.

On cybersecurity, Doraiswami said LIC had made substantial investments to secure its IT systems and was deploying artificial intelligence-based security measures. The company’s digital infrastructure also receives special monitoring and government support as critical information infrastructure.

LIC is focusing on protection, health insurance, annuity and pension products as part of its future strategy. It has recently launched products such as Bima Platinum, Jeevan Raksha, LIC Cancer Cover and LIC Health Shield.

The company will pursue balanced growth across savings, protection, ULIPs, annuity and group insurance segments, he said.

On the “Insurance for All by 2047” goal, Doraiswamy said LIC was committed to expanding insurance coverage across the country. Through the Bima Sakhi scheme, it is working to have at least one woman agent in every gram panchayat.

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