State-owned Life Insurance Corporation of India (LIC) is poised to reveal its acquisition plans within the health insurance sector by March 31, the end of the current fiscal year (FY25). This announcement came from Siddhartha Mohanty, LIC’s managing director and chief executive officer, during an event on Tuesday. While details about the specific company LIC intends to invest in remain undisclosed, Mohanty confirmed the move signals LIC’s expansion into the health insurance market.
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“We have plans. Discussions are at the final stage,” Mohanty stated at the Global Conference of Actuaries in Mumbai. He added, “It is a natural choice for LIC to enter health insurance… Since regulatory approvals take time, I am hopeful that a decision will be taken within this financial year, before March 31.” He also clarified that LIC will not be acquiring a majority stake.
This planned acquisition follows LIC’s earlier statement from the first quarter of FY25, where the company indicated its intention to acquire a stake in a standalone health insurance provider to enter the health insurance market. There are currently seven standalone health insurance companies: Star Health & Allied Insurance, Niva Bupa Health Insurance, Care Health Insurance, Aditya Birla Health Insurance, ManipalCigna Health Insurance, Narayana Health Insurance, and Galaxy Health Insurance.
In addition to the acquisition, Mohanty also discussed LIC’s request for the Reserve Bank of India (RBI) to issue more long-term bonds. Following the RBI’s earlier approval of a 40-year bond, LIC is now in discussions for 50-year and 100-year bonds. “We are long-term investors. We have contractual obligations to pay back as per the contract. So, I have to manage investments and asset-liability management properly… Western countries have long-term bonds,” Mohanty explained. The introduction by the RBI of 50-year bonds to address the rising need from insurance and pension funds aligns with LIC’s investment strategy.
