Unfazed by volatile stock markets, insurance behemoth Life Insurance Corporation proposes to invest nearly Rs 2.5 lakh crore in both equity and bonds this year.
“We made an aggregate investment of Rs 2.25 lakh crore last year. This year it would increase by 10 per cent,” the LIC Chairman, S.K. Roy, told PTI.
Thus, the country’s largest insurer is expected to pump in Rs 2.47 lakh crore in shares and bonds.
Increase in exposure to the equity market, secondary or primary, would depend on the market condition, he said, adding that the Corporation has been investing in stock markets in the past few weeks as there are opportunities.
On its earnings, LIC expects to achieve a 15 per cent growth in the first year premium income in the current financial year as against a contraction in the last fiscal.
During 2012-13, the country’s only state-run life insurer registered a 6.5 per cent fall in new premium collection at Rs 76,200 crore compared to Rs 81,500 crore during the earlier fiscal.
Apart from urban areas, the company intends to focus on rural areas and Tier II and Tier III cities as it sees a lot of business opportunities in these pockets.
To increase its presence, LIC recently opened 300 mini offices across various smaller cities in the country.
These offices have one LIC official posted, who provide basic insurance services, with agents helping these offices in collecting premiums.
Simultaneous opening of these offices is part of a plan to set up 1,700 such offices in locations with population of 10,000 and above by December.
In his budgetary speech for 2013-14, Finance Minister, P. Chidambaram, had said insurance companies will be empowered to open branches in Tier II cities and below without prior approval of Insurance and Regulatory Development Authority (IRDA).
“All towns of India with a population of 10,000 or more will have an office of LIC and an office of at least one public sector general insurance company. I propose to achieve this goal by March 31, 2014,” he had said.