LIC IPO 2022 – Guide on IPO LIC

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LIC IPO 2022 – Life Insurance Corporation is the only government-owned insurance company in India. Lic was founded in 1956, Over 245 insurance companies and provident societies were merged to create the state-owned Life Insurance Corporation of India. The LIC had a monopoly in the life insurance space until the 1990s, after which the government opened up to the private sector. For a long time, the term ‘LIC’ was synonymous with life insurance. LIC has around 2,048 branches in India. As per the latest annual report of LIC, there are 8 zonal offices in India. Zonal offices are situated in Delhi, Chennai, Mumbai, Kolkata, Kanpur, Patna, Bhopal and Hyderabad, Besides zonal and branch offices, there are 113 Divisional Offices, 1,178 Mini Offices and 1,526 Satellite Offices.

Finance Minister Nirmala Sitharaman announced a proposal to conduct an initial public offering for LIC in the 2021 Union Budget. The IPO is expected to be held in FY22. The Government of India will remain the majority shareholder after the public listing. Ten percent of shares are proposed to be allotted to existing LIC policyholders. In year 2021, government of India had proposed to significantly enhance the authorized capital of Life Insurance Corporation of India (LIC), to INR 250bn ($3.4bn) to facilitate its public listing scheduled for the next fiscal year which will begin on 1 April.

Strengths & Risks – LIC IPO

  • According to LIC’s 2019-20 annual report, LIC had a market share of around 69% in the life insurance space.
  • The network of LIC agents in the country is humongous. According to Life Insurance Council, the number of LIC individual agents as of March 31, 2021, were 13.53 lakh compared to a total of 11.01 lakh agents for over 20 private life insurers.
  • The company offers a wide variety of life insurance plans, endowment plans, whole life plans, money back plans, term insurance plans and insurance riders.
  • Apart from life insurance, LIC has the following businesses: LIC Housing Finance, LIC Mutual Fund, LIC Pension Fund, LIC Cards Services. In 2019, LIC acquired IDBI Bank as well.
  • LIC has over 1.14 lakh employees.
  • LIC also directly operates through its foreign branch offices in Fiji (Suva and Lautoka), Mauritius (Port Louis) and United Kingdom (Wembley).

It faces competition from many private players offering better service to policyholders. Being a PSU, there are certain restrictions on LIC. LIC also needs to change its internal policies based on any fiscal/monetary policy changes in the country.

What is the LIC policyholders category? Will LIC policyholders get any benefit if they apply?

“Policyholder” is a new category introduced for the LIC IPO, this category will have up to 10% of the issue reserved for the customers who hold policies of LIC. To be eligible for making an application under the policyholder’s category;

  • Your PAN has to be updated in the LIC records.
  • The PAN used for LIC policies has to be the same as that registered with your demat account.

How can I check if my PAN is already linked with my LIC Policy?

To check whether your PAN is already linked to your LIC policy:

  1. Visit this page.
  2. Enter your Policy number, Date of Birth, PAN, and captcha in the respective fields and press submit to see your LIC policy and PAN link status.

If your LIC policy is not linked with your PAN, you can follow the steps given below to get this done.

How do I link my PAN with my LIC policy?

To update your PAN with your LIC policy:

  1. Visit this page.
  2. To complete the process. You will need your PAN, along with the list of policies you hold. Click on “Proceed” at the bottom of the page.
  3. On the next page; Enter your Date of Birth, as per PAN, Gender, Email ID, PAN, Full name as per PAN, Mobile number, Policy Number (In case you hold multiple policies, click on “Add Policy” and proceed to enter another policy number)
  4. Click on the deceleration checkbox
  5. Enter the captcha.
  6. Click on the “Get OTP” option.
  7. Once you receive OTP on your registered mobile number, enter the OTP and click on “Submit”.

How do I apply to the LIC IPO?

You can apply for the LIC IPO using any supported UPI app by following two steps:

  • Enter your bid through your demat account.
  • Accept UPI mandate on your phone

On acceptance of the mandate, the bid amount will get blocked in your bank account. 

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