Full Form of LIC – Life Insurance Corporation of India
The full form of LIC stands for Life Insurance Corporation of India. Life Insurance Corporation of India is a government company in the field of insurance and investment that is an outcome of the Life insurance of India Act, which brought the insurance sector under the government’s control through nationalization and thus, LIC came into existence in the year 1956
Mission of LIC
As per the LIC website, the mission is to provide the people financial security through products and services at a higher return than other investment players in the market and thus help them maintain a particular standard of living and provide economic development.
Objectives of LIC
- Help in penetration of LIC to rural and backward areas and providing affordable death cover to the maximum number of people.
- Channelization of savings to investment for economic development and providing attractive growth opportunities.
- The fund raised through such policies is invested in the best interest of the policyholders and in the sectors of national importance in alignment with the country’s goals.
- Act as trustee of the insured.
- Cater to the changing needs of the sector, along with the evolution of the economy.
- Bring out the best in the employees in terms of capability in the best interest of the policyholders.
History of LIC
In Pre-independent India, the first company to provide life insurance services was Oriental Life Insurance Company, which focused more on the European population and charged higher premiums from Indians. Post that, Surendranath Tagore started the Hindustan Insurance Society. And till 1956, a lot of other players had sprung up in the industry. However, due to increasing fraud in the sector, in 1956, the Parliament passed the act of nationalization of the sector.
In this period, the Industrial policy resolution of 1956 came into force, which nationalized 17 sectors, one of which was the insurance sector. As an outcome of nationalization, the 254 private players in the insurance sector merged into the Hindustan Insurance Society and formed the LIC of India.
Types of Plans in LIC
The following are the available plans of LIC:
#1 – Aam Aadmi Bima Yojna
- Age should be between 18 and 59 years
- Head of a family below the poverty line or slightly above the same
- Initial premium Rs. 200 p.a. for a policy having a cover of Rs 30000
#2 – Insurance Plans
- Combination of savings and protection
- The minimum death benefit is Rs. 50,000, and there is no maximum limit
- Some policies require monthly premium payments
- A loan can be secured against the policy
- At the time of maturity, the money paid up as premium is returned along with a bonus if the death of the holder or other triggers event doesn’t occur
Whole Life Plan
- Combination of income and protection
- Annual benefits from the time when premium payments stop until the maturity of the policy
- Lump-sum payout at maturity or death
- The loan can be taken against the policy
Other Insurance Plans
- Money-Back plan
- Term Assurance Plan
Apart from these, LIC also has the following plans
- Pension Plan
- Unit Plan
- Health Plan
- Micro-insurance plan
Structure of LIC
The LIC committee consists of 15 members appointed by the Central Government of India. Following is the structure of this committee:
- There are 4 managing directors, 4 members, and 3 non-official directors in the LIC board of directors currently.
Further, the responsibilities are divided into 4 tier offices described as follows:
- Central Office: There is only one Central office located in Mumbai. It takes up the following.
- Investment responsibility
- Formulation of regulations and their administering
- Zonal Offices: There are 8 Zonal offices in different geographies
- These, together with divisional offices, carry down the central office policy down to the branch offices.
- Divisional Offices: There are 113 divisional offices to traction greater penetration into India
- Branch Offices:
- These carry out all the front end roles between the policyholders and the LIC.
- There is a total of 2048 such offices.
- Satellite offices: There are a total of 1048 such offices
Below is the typical hierarchy of the LIC and all its offices-
International Operations of LIC
LIC has international operations in Fiji, Mauritius, United Kingdom, Bahrain, Nepal, Sri Lanka, Dubai, Abu Dhabi, Oman, Qatar, Saudi Arabia & Kenya
Benefits of LIC
Being part of the LIC team has several benefits:
- Work Satisfaction: Helping people achieve their financial goals is rewarding in itself and gives the employee a great deal of work satisfaction
- Success: LIC is the team of best in the insurance industry and therefore, there is a great peer learning opportunities and a successful career path ahead
- Lucrative Salary and Perks: Takes care of current and future income and the employees’ targets as it has the best investment research team at its disposal.
- Global Exposure: As LIC is operating at a multinational level, the corporation’s training is of a very high standard and at a world-class level.
- Wide Range of Products: LIC has a very wide portfolio of products and services it provides and therefore, the employee gets exposure to all these products over the period of his career with LIC
- Established Brand: LIC is known in every household, and therefore, there is a lesser effort required in selling the brand. The effort is required in selling the products only while in the case of other players, selling the brand in itself is a task leave alone selling the products.
So, in the end, LIC, as a whole, is an institution, not just for insurance but for various different kinds of services such as investments, pensions, health benefits, among others. It is a one-stop solution for all kinds of financial services required by any individual or institution and has a team of close to 1 million employees as on 31-3-2018
A career in LIC is a launchpad in India and abroad’s insurance sector, and it can bring out the best in the employees through its world-class training and infrastructural support.
This has been a guide to the Full Form of LIC, i.e., (Life Insurance Corporation of India). Here we learn the objectives, types of plans in LIC along with its structure, benefits, and history. You may refer to the following articles to learn more about finance –