ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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LIC Must Adopt Industry Best Practices

The article argues that the Government of India must set a realistic initial public offer price band for the Life Insurance Corporation, taking into account the insurer’s risks and weaknesses. The LIC’s IPO is currently an offer for sale wherein the GoI will receive all proceeds. The LIC must also receive a share of the initial public offer proceeds to strengthen its solvency and profitability.

LIC IPO

There are serious apprehensions that post initial public offering, the Life Insurance Corporation of India would have to change its very business model, whereby it will have to push for the sale of more non-participatory policies as 100% of profits from such policies will flow to the shareholders. Thet neglect of the rural business will hurt the interests of the lower-middle and poorer sections who look at LIC policies as an instrument of social security.
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