LIC IPO details

LIC meaning

LIC means  Life  Insurance Corporation of India. It started its operations as a company firm in September 1956 when the life insurance of India Act elapsed in India’s Parliament in June 1956. The LIC Act came into result in July 1956. It helped in the nationalization of the non-public insurance industry in India. LIC of India was formed by merging 154 life insurance firms, sixteen foreign corporations, and seventy-five provident corporations. It's one of the most important financial institutions in India. It's an asset worth over a pair of,529,390 crores. The headquarters of LIC is in Bombay, Maharashtra. 

 Motto of LIC

The significant motto of LIC is- “Yogakshemam Vahamyaham” which means “Your welfare is our responsibility”. It's in the Sanskritic language and is obtained from the twenty-second verse of the Bhagavad Gita’s ninth chapter. The chairman of life insurance of India is Mr. M. R Kumar. 
The first company in India that provided coverage was The Oriental life insurance Company, established in 1818, in Kolkata. Surendranath Tagore supported the geographic region Insurance Society that later became the life insurance Company

Role of LIC in the Indian Economy

  • LIC is understood as India's largest government-owned life insurance and investment corporation. The role of LIC is to invest in international financial markets and completely different government securities while gathering funds from individuals through their numerous life insurance policies.

  •  A minimum of 75% of those gathered funds are to be invested within Central and government securities, as explicit by one in all the LIC rules. 

The Functions of LIC are as follows

  • Collect people’s savings in exchange for insurance and promote savings within the country. 
  • Protect the capital of the individuals by investing funds into government securities. 
  • Issue insurance policies at reasonable rates 
  • Providing numerous loans like direct loans to industries, housing loans, and loans to varied national comes at affordable interest rates.

Purposes of LIC 

  1. LIC aims to unfold awareness regarding the importance of life assurance among individuals living in rural areas and folks who are a district of socially and economically backward categories. 
  2. It aims to fulfil many life insurances wants of the community people that are subjected to vary with the ever-changing social and economic atmosphere. 
  3. It aims to conduct business economically while taking into the thought that the money belongs to the policyholders. 
  4. It aims to maximize the quality of people’s savings through engaging insurance-linked savings. 
  5. It aims in providing the utmost job satisfaction to any or all the agents and staff of the corporation and promotes building a cooperative work atmosphere to deliver economical service in a well-mannered way to its insured public. 
  6. It aims to deploy the funds to the most effective advantage of the investors and also the community. 

Types of LIC insurance Plans 

LIC provides Various schemes to its policyholders. It offers completely different schemes for various classes and segments of the Indian economy. it's the most important policy company in terms of the number of policies it's issued thus far. a number of the policies are as follows:- 

  •  LIC’s Jeevan Pragati 
  •  LIC’s Jeevan Labh 
  •  LIC’s Single Premium Endowment arrange 
  • LIC’S Jeevan Lakshya 
  • LIC’s Jeevan Tarun 

What are the fundamental Policies of the LIC  of India? 

  • The basic policies in  LIC are term insurance, cash value insurance, straight life insurance, and limited payment life insurance. The main points of every one of those policies are given below: 

Term insurance:

  • This insurance is like an insurance protection contract, almost like motor vehicle insurance, home insurance, or health insurance. Therefore, it ensures the individual against any risk of economic loss just in case of death and doesn't embrace any savings set up.
  •  During this policy, the owner buys an amount of coverage and pays an annual premium depending upon their age. The policy is for a set period of your time and therefore the coverage stops if it's not revived. These policies are out there for 5 years, 10 years, or fifteen years wherever the number of premiums to be paid remains constant.

  • The insurance may be purchased with a condition of sixty-five years aged, that is, the insured doesn't become sixty-five years of age and during this case, the amount of premium to be paid will increase annually. There's decreasing term life insurance conjointly obtainable whereby the coverage of the insurance decreases with time so the annual premium to be paid remains constant. Term insurances give maximum coverage to the premium spent. 

 Cash price insurance:

  • During this type of policy, the number of actual insurance decreases over time, and also the savings element of the policy will increase over time. This kind of insurance is funded by the premium payments done by the insured together with the earnings of the saving component within the policy. These insurance policies are of 2 types: a straight life policy and a limited payment policy that gives coverage to the insured throughout life. 

Straight life insurance:

  • The insurance is throughout life. During this form of insurance, the number of protections decreases because the savings amount will increase, although the full coverage of the policy that has the protection and savings components remains similar. The premium in these policies is over the insurance that is predicated on the age of the individual once he or she buys insurance. The premium for this policy remains constant. The face price of insurance refers to the quantity that is paid once the insured dies.

Limited payment life insurance:

  • During this form of policy the insured pays the full quantity of policy during a restricted range of years, that is, sometimes twenty to thirty years or by the age of sixty-five. When the completion of the term, the policy remains active for the entire lifetime of the insured if he or she has not withdrawn the quantity at any purpose in time. The amount of premium to be paid once a year during this policy is clearly over the straight life policy. 

Initial Public Offering 

Any Organization forms the opinion to go public when it receives profits and capital returns and on it. This procedure is known as Initial Public Offering simply called IPO. In the starting days of any work or a business, it is helped by promoter funds that encompass the entrepreneur’s savings. 

LIC in IPO 

  • Start date: 04th May 2022 
  • Size : ₹21,008.48 cr 
  • Price range: ₹902 - ₹949 
  • LIC IPO is made available in lots sized 15/lot. 
  • Inception day metrics: 67% subscription (types: Policy holders(2,2cr)/ Employees(0.2cr)/ Retail(6.9cr)/Institutional buyers(4cr)/corporates/high-net worth (3cr)).. 
  • Initially, LIC had allotted a share price of about RS.5600 crores, to institutional investors, led by SBI mutual fund. 15 domestic MF investors picked up 71 % of it while the remaining were picked by foreign portfolio investors. 
  • LIC policyholders and employees have a lot of chances to acquire shares after the allocation of shares.