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Monday, November 5, 2012

LIC eyes distribution tie-up with Postal Department

Life Insurance Corporation of India is in favour of having a distribution tie-up with the Indian Postal Department, which has plans of its own in the insurance space.

The Government has launched an initiative to pave the way for over 1.5 lakh post offices in the country to offer full-fledged banking and insurance services. Postal Life Insurance is also setting up a full-fledged investment division for generating optimal returns.

“They (the postal department) have a huge network. It will be prudent to have some kind of distribution synergy between the department and LIC. We are in favour of such a synergy,” LIC Chairman D. K. Mehrotra told Business Line on the sidelines of the inauguration of the All-India LIC Games here on Monday.

A tie-up of this nature could change the insurance landscape in India as LIC controls nearly 80 per cent of the domestic life insurance market, while the postal department has a stronger rural network.

Vision 2020

He said LIC’s newly chalked out Vision 2020 to have every Indian backed by an LIC policy was a “daunting task”, but efforts were on to achieve this. He said different groups have been set up to draw up a roadmap for this vision, including branch expansion, recruitment and launching of new products.

The aim is to increase the number of its policyholders from the current 40 crore to 100 crore.

Online products

Mehrotra said the company would come out with its second and third on-line products. “We have today one online product and we will come out with two more in the next two or three months. While the first is in the pension category, the two new ones will be simple endowment-related products. We do not want to put any complex products online yet,” he said.


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