Life Insurance Corporation of India (LIC) plans to invest Rs. 2-lakh crore across asset classes in 2010-11, up from the Rs. 1.92 lakh crore last fiscal.
“We have internally targeted to invest Rs. 2-lakh crore across asset classes by the end of this fiscal,” LIC Chairman T. S. Vijayan told reporters here after announcing a valuation surplus on investments of over Rs. 23,000 crore last fiscal.
The targeted premium collection for the year was Rs. 2.01 lakh crore, he said.
In the first quarter of 2010-11, LIC invested Rs. 39,000 crore, of which Rs. 10,000 crore was in equities, he said. Mr. Vijayan, however, refused to give the equity component of the targeted Rs. 2-lakh crore investment, saying it depended on the premium collection from the Unit-Linked Insurance Policies (ULIP).
LIC also had headroom to issue infrastructure bonds of Rs. 5,000 crore this fiscal but had not yet decided on any timeline for it, he said.
“Under a new policy, we can issue bonds to the tune of 25 per cent of our incremental investments of Rs. 25,000 crore in the infrastructure sector last year,” Mr. Vijayan said.
The life insurer was also targeting to invest Rs. 1,000 crore in real estate and property this fiscal, he said. About LIC's expansion plans, Mr. Vijayan said the corporation was in “advanced stages” of discussions to set up a wholly-owned subsidiary in Singapore.
LIC's first-year premium rose 34 per cent to Rs. 70,891 crore in 2009-10 from Rs. 52,954 crore in the previous fiscal.
The company's total assets under management (AUM) increased 32 per cent to Rs. 11.52-lakh crore. The premium income of the corporation rose 18.32 per cent to Rs. 1.86 lakh crore from Rs. 1.57 lakh crore last fiscal, while the total income went up to Rs. 2.99 lakh crore, a 49.15 per cent increase from the previous year, Mr. Vijayan said.
The first premium collection more than doubled to Rs. 18,740 crore from last year and LIC's market share also inched up to 73.43 per cent in the first quarter of 2010-11, he said.
LIC would have to “tweak” its existing ULIP offerings in order to comply with the revised guidelines issued by Insurance Regulatory and Development Authority (IRDA) that would come into effect September 1, he said.
“We are working on revising our products and hope to get all the approvals from IRDA to launch them by September 1,” he said.
Under the new guidelines, the lock-in period for ULIPs goes up to five years from three and all ULIPs had mortality and health cover, besides a slew of other measures.