LIC & GIC Beat Economic Downturn

It is yet another year of stupendous performance by the Public Sector Insurance Companies. The journey of success continues despite pronounced global recession. A cursory glance at the figures of Premium Income, Number of Policies secured indicate that whatever may be the efforts of the Government of the day to tarnish the image of the Public Sector, the Public Sector Insurance Companies are shining in glory with yet another year of great achievement. The total First Premium Income of LIC stands at a whopping Rs.42,960.44 Crores by selling 3.88 Crores of Policies during the year registering a growth of 21.63% in Individual New Business. The market share of LIC has also improved with New Business accounting for 64.86% and the Number of Policies 73.02%.33.87% when the Private Insurers have painstakingly achieved a cumulative growth of just 12.43%. In the realm of Group Insurance, LIC commands Rs.20,775.56 Crores as Premium income and a market share of 75.39%. This really is the jewel in the crown of the Financial Sector Institutions. The story of Private Insurance Companies in India has been so dismal that most of the companies have registered a negative growth.
The Public Sector General Insurance Companies too have done an excellent job in increasing the growth rate during the year. The United Insurance Company has mobilized Rs.5,239.05 Crores, with a growth rate of 22.47%; Oriental Insurance Company mobilized Rs.4,718.75 Crores with a growth rate of 19.02%; New India mobilized Rs.6013.43 Crores with a growth rate of 9.16%; and National Insurance Company has mobilized Rs.4620.92 Crores with a growth rate of 7.97%. The leading Private Insurers have registered either a negative growth or a negligible growth rate during the period. ICICI Lombard has registered a negative growth of 3.56%; Bajaj Alliance -4.73%; and Reliance has managed to register a growth of 3.38% and Tata AIG 0.49%. This indeed is the contrasting story of Insurance Industry in India following opening up of insurance sector for competition by the Indian Government.
The progress of LIC and GIC at a time of economic downturn indicates the commitment of the employees towards Public Sector Insurance Companies. This is a fact born out by the statistics furnished in the foregoing which should enable the right thinking people to demand of the Government of India not to disturb the present stature of the LIC and GIC and on the contrary the Government should be persuaded to adopt such measures that are required to strengthen these two financial institutions. Unfortunately, notwithstanding marvelous performance, year after year by the Public Sector Insurance Companies, the Government appears hell bent on increasing the equity base of the LIC and GIC with an ulterior motive of privatizing them. The increase in the FDI limit from 26% to 49% is also to favour Private Insurers. The insurance employees while rejoicing over the continued triumphant onward march of the public sector insurance companies, may have to once again undertake the arduous job of mobilizing the public opinion in favour of the LIC and GIC through a programmatic action so that the government is prevented from going ahead with the ill-advised reform measures. At the same time, the employees naturally look forward to managements’ initiative to satisfactorily resolve the long pending issue of wage revision as they have enormously contributed to this success story. The resolve to fight the ill-conceived move of the government has to remain uppermost in the minds of the employees as the Government’s main agenda is to disturb the Public sector institutions at the behest of the International Finance Capital.