Life Insurance Corporation of India (LIC) is planning to enter the health insurance segment through a private health insurer, according to a livemint report citing two LIC executives. For this, the state-owned life insurance giant is looking at acquiring one of the five private standalone health insurance companies.
The development comes days after LIC Chairman Siddhartha Mohanty on May 28 talked about “inorganic” options for the insuance giant’s new initiatives in the health insurance. He said, “Internal work is going on.”
In order for LIC to make a foray into the health insurance sector, the government will likely have to amend the existing insurance legislation. Under the current laws, the regulatory body Insurance Regulatory Development Authority of India (IRDAI) and the Insurance Act of 1938 do not allow composite licensing for an insurer to undertake life, general, or health insurance under one entity.
LIC is not an expert in general insurance like fire and engineering but it can do health insurance, Mohanty said, according to a recent PTI report.
In February, a parliamentary committee suggested the introduction of a composite licence for an insurer to undertake life, general, or health insurance under one entity to increase the penetration of insurance in the country.
The panel headed by BJP leader Jayant Sinha had suggested the government to introduce a provision of composite licensing for insurance companies and make the related amendment in legislation at the earliest.
Meanwhile, insurance behemoth LIC posted a marginal 2 per cent increase in net profit at Rs 13,763 crore in the fourth quarter ended March 2024 as the corporation made provisions for wage hikes. The insurer had earned a profit of Rs 13,428 crore in the corresponding quarter a year earlier.
LIC reported a 26.41 per cent increase in the total premium collected in March 2024 to Rs 36,300.62 crore compared to Rs 28,716.23 crore in the same month a year ago.
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