India's biggest life insurer, state-owned LIC, is expected to issue Point-of-Sales machines to around 200,000 agents to facilitate premium collection.
The move is in line with a nudge by the Finance Ministry for LIC to arm its 2-million strong agency force with such machines.
“This is in sync with the government’s aim of strengthening the digital payment infrastructure. The insurer will also set up a cyber security cell to monitor any deviation,” a senior government official told The Economic Times. Around 90% of LIC’s premiums are currently collected through its agents. LIC already has about 40,000 collection centres — more than banks do.
The insurer is also looking into Aadhaar-linked digital transactions, the official said, adding that this will help policy holders in rural areas to avoid paying for premiums in cash. Aadhaar is a 12-digit unique identification number issued by the Indian government to every individual resident of India.
Meanwhile, LIC Chairman V K Sharma told the media on Monday that the giant insurer has a mission with a specific timeline to provide digital solutions to customers in a "cost-friendly' way. LIC plans to introduce a mobile app soon as part of its digital initiatives.
LIC is also modernising in that for the first time in its history, the company publicised its quarterly financial performance numbers on 27 February.
Prior to this, details such as LIC’s premium income, expenses, investment transactions and more were already available on its website as a part of the quarterly public disclosures mandated for all life insurers. These disclosures were generally made without fanfare. LIC would be setting a new trend now by announcing its quarterly results regularly, Mr Sharma said.
The figures show that for the first nine months of the current financial year – that is, from April to December 2016 – LIC posted a 12.4% increase in total premium income to INR145,031 crore (US$2,169 crore) compared to the corresponding period in 2015. New business income grew 40.11% in the nine months ended 31 December 2016, boosted by fund flows into the formal financial system during demonetisation. “We met our yearly target of INR31,000-crore new business income a month before the year-end,” said Mr Sharma. The insurer hopes to hit a new target of INR35,000 crore of new premiums for FY2016-17.
Total assets grew by 12.8% to INR24.4 lakh crore at 31 December 2016, compared to INR21.6 lakh crore at 31 December 2015.