LIC’s Journey: The Story of India’s leading insure

by Finnegan Callan
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LIC IPO is surely one of the biggest IPO. The upcoming IPO will make the mark in Indian stock markets history of the company which will be made a public listed company and retail investors from the stock market will be able to be a part of the lics growth.

The major highlights of the company are as follows

Lic had 5 zonal offices back in the year 1956 it had 33 divisional offices and 212 branches offices apart from the corporate office currently as of September 32 1021 the company operates through 8 zonal offices 113 dimensional offices and more than 4700 branch offices and mini corporate offices. The corporation site jump off around ₹200 crores of the new business in 1957 and 2000 plus crores by the 1969 to 70 in terms of business.

 It took another 10 years for the company to cross the 2000 crore mark for the new business with reorganization taking place in the early 80s. In the year 1985 and 86 the company had crossed ₹7000 crore some assured run the new policies. All the private players had a market share of around 33.82% as of March 31 2021 in terms of market share.

Agent network

The strong agent network is one of the strongest strengths of the journey of the past 65 years. As per the research alliances individual agents comprise around 55% of all the individual agents in India. The total individual agency forces around 7.2 times the number of agents of the second largest life insurer in terms of the agent report. The company has around 12.8 lakh individual agents in 2021. There is a constant increase in the number of agents as further research.

The research also added that the companies agents sold around 15.3 and 5.3 individual policies on average in 2021 fiscal. The report mentions that LIC has maximum productive agent network in the Indian life insurance sector. The lic agents add an average new business premium of around 4,17, 538 for agent.

The key investments of the company

Lic has 100% stake in the lic pension fund card services and insurance corporation as of 30th September 2021. It also holds 83.33% stake in the lic of Bangladesh 55% stake in lic Nepal and 99.66% stake in Bahrain based LIC. The insurer also has a stake of around 29.84% in the IDBI trust ship services. There are around 14 companies where the lyc is characterised as the promoter and 13 companies where the company has a stake of more than 20%.

Financial statement analysis


Despite the increased competition during the past 3 fiscal years the insurance companies premium have seen an increase. The company has earned a premium of around 4,5 398 crore for the year ended 31st March 2021. There is an increase of around 6% as compared to 2020 and also 19% increase when compared to 2019. Lics renewal premiums stood around 54% of the total premium on in the fiscal 2021 when it comes to the renewal premiums and 52.91% of total premium in fiscal 2020.

Other earnings

Interest dividends and rent received from the investments have also seen a steady increase in the past 3 years. For the year ended March 31 2021 the insurance company had earned around 2,39,565 crore as a part of rent received and interest on from the investment. The profit and after tax is around rupees 2974 crore for the year ended 2021.


The operating expenses of the insurance company related to the insurance business also witnessed an increase from 28,331 crore in 2019 to ₹35,162 crore for 2021. There is a increase of around 24% in the expenses.

Bonus or dividend paid to the policyholders

Insurance companies received a lot of cash as premium from the policyholders. The insurance companies then invest most of the amount in bonds securities and other financial investments for profit. The surplus amount is made by the companies from the profits that is paid as bonus to the policyholders.

Challenges faced

There were a lot of restrictions on the agent movement due to the covert restrictions. The restrictions on movement of people and vehicles the agent distribution network faced several challenges. The lics active number agent decreased by 17.48% from 10.8 6,00,000 as 31st March 2021 to 8.9 6,00,000 as of September 30 1021.

Deferral of exams

The pandemic caused a lot of challenges for the exams that are caused by the IRDA for the individual agents and corporate agents furthermore it also prevented the company from adding new agents.

Business practice complaints higher in 2021 as the company received around 3994 unfair business practices complaints.

Above all when compared to the private players the companies ratio of 2 is to one unfair business practice complaints 4000 policies in fiscal 2021 was quite low than other players in the market. When there were median number of top 5 players it was around 19 is to 5.

One of the main challenges that the company has paste in the current market is the entry of new competitors. The new entrance have a strong presence on the digital platforms . on the flipside lyc relies on typical individual agents to deliver the individual products.

Above all the companies journey by far is great and inspiring at the same time.

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