Life Insurance Corporation of India (LIC) is poised to enter the health insurance market, according to CEO Siddhartha Mohanty. In a recent interview with CNBC-TV18, Mohanty revealed that the public sector life insurance company is in advanced discussions to acquire a health insurer, with the goal of finalizing and announcing the acquisition before March 31st.
Mohanty clarified that LIC will not hold a majority stake in the company it intends to acquire. This move signifies a strategic diversification for LIC.
Previously released data from the Life Insurance Council indicated a 12% year-over-year (YoY) decrease in new business premiums for life insurance companies in February, totaling Rs 29,985.58 crore compared to Rs 33,913.18 crore the previous year. LIC itself experienced a decline, with its monthly premium dropping by 22% to Rs 15,513.95 crore.
During the fiscal third quarter earnings call, Mohanty acknowledged that new surrender value norms set by the Insurance Regulatory and Development Authority of India (IRDAI) had influenced premium collections. The insurer responded by revamping its product offerings and adjusting agent commissions to mitigate the impact. Mohanty expressed optimism that collections would improve in the fourth quarter.
The company’s fiscal third quarter earnings report, released in February, showed a 21% YoY decline in new business premium (NBP) for Q3FY25, reaching Rs 43,075 crore. However, the standalone profit for the quarter increased by 17% year-on-year, reaching Rs 11,056 crore from Rs 9,444 crore in the same period last year. This demonstrates a degree of financial resilience even amidst market challenges.
