LIC plans to sell 1 cr Bima Gold policies by March '06

Life Insurance Corporation of India (LIC) is targeting to sell one crore Bima Gold policies by March 31, 2006. The plan has the minimum sum assured of Rs 40,000 which will help the corporation attract rural population.

On a conservative estimate, the state-owned life insurer expects to generate a first premium income of Rs 2,000 crore. The actual premium collection, however, would depend on the level of response and extent of sum assured per policy.

The aggregate average premium per policy for LIC works out to about Rs 3,000. Bima Gold, a low cost insurance cover, is directed at masses and the average premium was likely to be less than Rs 3,000, a senior LIC official said.

"We will reach out to existing 16 crore policyholders to market Bima Gold policy besides looking for new customers," said A K Shukla, chairman. "With the lower amount of the sum assured, we expect more rural customer to get attracted towards the policy," he added.

The policy was launched by Prime Minister Manmohan Singh in Lucknow on September 1 to mark the 50th anniversary of the corporation.

The corporation has also targeted overall Rs 1,00,000 crore premium income to be collected for the current fiscal. LIC expects 25 per cent of its targeted business to be achieved by the end of September 2005.

"Our target for the current fiscal is a 30 per cent growth in policies but till July end we were trailing. Now we are in positive terriotory and we are confident to garner 25," said Shukla.

On an experimental basis, LIC has also planned to roll out 29 Satellite Sampark branches in different parts of the country. Satellite Sampark branches are basically an extension of large branches coming up in new urban/semi urban centres and new townships, not so far covered by the existing network of 2,048.

The satellite offices will provide the customers the facility to make their premium payments, claims payments, policy servicing, and enquiries related to their policies without going to the main branch.

After reviewing the experiences with these satellite branches LIC may look into opening more satellite offices. "Ideally we would like the number of satellite offices to over take the number of ATMs," said T S Vijayan, managing director, LIC.