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The LIC Agents’ Organisation of India will hold a massive dharna at Azad Maidan in Mumbai on Wednesday to present a charter of demands to the LIC management.
Agents have not agitated for a raise in their commission since 1956, PG Dileep, General-Secretary of the organisation, told BusinessLine.
RETAIN COMMISSION
This is despite the price of essential commodities and petroleum products having shot up many times over during this period.
“Even now we are not asking for a raise in the commission rate. Our main demand is that the existing commission on policies should not be reduced.”
Dileep said the very existence of agents was now under threat due to a decision to eliminate the agency system.
If an agent were to lose his job, the Government would not be able to provide him alternate employment because of the sheer numbers involved — 12 lakh.
‘Save LIC and protect agents’ is the slogan of the Association, Dileep said.
GLOBAL MODEL
LIC's service model, represented by its agency force, was a globally acclaimed model.
But various regulations imposed by LIC over the last two decades have been directed at eliminating this very force.
About 17 lakh have been terminated during the last five years. Though recruitment has been attempted through various channels, the total number achieved last year was only 91,052.
If the LIC has successfully withstood competition from the private sector during the last 14 years, credit should go to the cooperation and hard work of the agents, Dileep said.
Multinationals and Indian corporates have realised that they can defeat LIC and eat into its business by destroying the agency force.
PREMIER COMPANY
LIC record of claims settlement over the past 11 years was the best globally. While other private companies settled 48-80 per cent of the claims every year, LIC has settled 99 per cent.
It has been investing its funds in Government securities and bonds and extending long-term loans to public sector undertakings at low interest. After the entry of private insurance companies, a part of the funds was being invested in the share market.
An amount of Rs. 70,000 crore was lying with the Government without interest as sovereign guarantee.
The service tax on policies was also borne by the LIC. All these have resulted in low returns, affecting the bonus payout to policy-holders.
POLICIES CLOSED
LIC was forced to purchase shares of companies and banks which were not performing well. It has dispensed with its conventional and other attractive policies with effect from January 1, 2014.
There was only one live policy till January 6. Now it has only nine policies against 56 policies during the same time last year.
Up to 80 per cent of the business was done during January-March. It was at this time that LIC has stopped a number of attractive policies.
About 38 crore people have been covered by these attractive policies and there was no justification in closing them.
Naturally, it would reflect negatively on the quantum of business done. Still, LIC commands 84.4 per cent of the insurance business. But it will need to face the threat of downfall from now on, Dileep said.
Source : Thehindubusinessline
Agents have not agitated for a raise in their commission since 1956, PG Dileep, General-Secretary of the organisation, told BusinessLine.
RETAIN COMMISSION
This is despite the price of essential commodities and petroleum products having shot up many times over during this period.
“Even now we are not asking for a raise in the commission rate. Our main demand is that the existing commission on policies should not be reduced.”
Dileep said the very existence of agents was now under threat due to a decision to eliminate the agency system.
If an agent were to lose his job, the Government would not be able to provide him alternate employment because of the sheer numbers involved — 12 lakh.
‘Save LIC and protect agents’ is the slogan of the Association, Dileep said.
GLOBAL MODEL
LIC's service model, represented by its agency force, was a globally acclaimed model.
But various regulations imposed by LIC over the last two decades have been directed at eliminating this very force.
About 17 lakh have been terminated during the last five years. Though recruitment has been attempted through various channels, the total number achieved last year was only 91,052.
If the LIC has successfully withstood competition from the private sector during the last 14 years, credit should go to the cooperation and hard work of the agents, Dileep said.
Multinationals and Indian corporates have realised that they can defeat LIC and eat into its business by destroying the agency force.
PREMIER COMPANY
LIC record of claims settlement over the past 11 years was the best globally. While other private companies settled 48-80 per cent of the claims every year, LIC has settled 99 per cent.
It has been investing its funds in Government securities and bonds and extending long-term loans to public sector undertakings at low interest. After the entry of private insurance companies, a part of the funds was being invested in the share market.
An amount of Rs. 70,000 crore was lying with the Government without interest as sovereign guarantee.
The service tax on policies was also borne by the LIC. All these have resulted in low returns, affecting the bonus payout to policy-holders.
POLICIES CLOSED
LIC was forced to purchase shares of companies and banks which were not performing well. It has dispensed with its conventional and other attractive policies with effect from January 1, 2014.
There was only one live policy till January 6. Now it has only nine policies against 56 policies during the same time last year.
Up to 80 per cent of the business was done during January-March. It was at this time that LIC has stopped a number of attractive policies.
About 38 crore people have been covered by these attractive policies and there was no justification in closing them.
Naturally, it would reflect negatively on the quantum of business done. Still, LIC commands 84.4 per cent of the insurance business. But it will need to face the threat of downfall from now on, Dileep said.
Source : Thehindubusinessline
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