LIC Plan To Entry In Health Insurance Sector: A parliamentary panel had suggested in February 2024 to introduce a composite insurance i.e. composite license to reduce the cost and compliance burden.
The country’s largest life insurance company LIC is now going to enter the health insurance sector. The government-run insurance giant is also exploring the possibility of acquiring a company already working in this sector. Amidst the proposal to approve composite insurance companies, Life Insurance Corporation of India has also prepared to enter the health insurance sector.
What did the LIC chairman say?
LIC Chairman Siddhartha Mohanty said that we are hopeful that the composite license can be approved and we have also done some work at the ground level. We are increasing our interest in health insurance and are also considering various growth opportunities. According to a TOI report, a parliamentary panel had suggested introducing a composite license in February 2024 to reduce the cost and compliance burden.
Changes will be needed in the Insurance Act
At present, Life Insurance Companies can only provide long term benefits under health insurance and they will need amendments in the Insurance Act to provide compensation cover after hospitalization or any other kind. For this, a parliamentary committee had suggested introducing a composite insurance license to reduce the expenses and compliance burden of insurance companies.
Let us tell you that at the end of 2022-23, less than 2.3 crore health insurance covers were issued, which cover 55 crore people. The government and insurance regulator IRDAI believe that more health covers should be issued and LIC’s entry into the health insurance sector is expected to accelerate it. This is the big reason why LIC has now geared up to enter the health insurance sector.
LIC’s quarterly results were excellent
Talking about the financial health of LIC, the company recorded a net profit of Rs 13,762 crore in the quarter ended March 2024, which is more than Rs 13,427 crore in the same quarter of the previous year. If we look at the performance of LIC in the stock market, then in the last six months, its share price has registered a jump of more than 52 percent. Along with this, LIC is among the top-10 valuable companies in the country and its market capitalization (LIC Market Cap) is Rs 6.51 lakh crore.
