LIC chief sees protection plans driving growth
R. Doraiswamy, managing director and managing director of the Life Insurance Corporation of India, outlined a vision focused on protection-focused products, a revamped product portfolio and a cautious assessment of the global economy.
In his message in his 69th annual report, Doraiswamy said that the uncertain global environment has reinforced the importance of financial protection, leading to continued demand for term insurance and protection-focused solutions.
He noted that the industry continues to shift towards conservation, digitalization and customer-focused innovation.
He separately flagged the impact of market conditions on LIC’s investments. He said increased volatility in equity and debt markets was impacting investment returns, creating difficulties in managing participating funds and ensuring stable premiums.
High interest rates driven by inflation concerns have had a mixed effect, supporting returns on fixed income investments but also affecting the attractiveness of some long-term savings products.
GST exemption galore
He welcomed the government’s move to exempt individual policies from goods and services tax and said complete waiver of GST on all individual policies is a “bolanza” that brings relief to policyholders.
He framed this as a measure to support demand as LIC works towards wider insurance coverage.
The message comes after a year in which LIC’s hedging move was clearly reflected in the figures. Non-participating products’ share of individual annualized premium equivalent increased to 35.11% in FY26 from 27.69% a year ago. This helped increase the new business value margin, an indicator of how profitable new policies are, from 17.6% to 21.2%; VNB increased by 41.63% to 41.63%. ₹14,179 crore.
LIC introduced 11 new products and made changes to five existing products during FY26 to better serve customers as their needs change.
Doraiswamy identified retention, a measure of how many policyholders continue to pay their premiums, as one of the areas that LIC’s new mobile apps aim to strengthen, along with growth and operational efficiency. In terms of premium, LIC’s 61st month retention stood at 59.31% in FY26 as compared to 63.12% a year ago.
Impact of the West Asian war
He based his message on a cautious macro basis. Referring to the International Monetary Fund’s January 2026 report predicting global growth of 3.3% in 2026 and 3.2% in 2027, he said the US-Iran war in 2026 has indirectly affected India’s life insurance sector through inflationary pressures on household incomes.
It pegs India’s GDP growth at 6.5-7.0% for FY26.
Looking ahead, LIC remains committed to protecting the financial future of millions of policyholders while strengthening its leadership in the industry, he said, expressing confidence that its founding and investment in innovation will help it continue to create value as it works towards its goal of “Insurance for All by 2047”.
