Life Insurance Corporation (LIC), the largest insurer in the country, is expected to initiate its initial public offering in the fourth quarter, Q4, of the current fiscal year FY22. To participate in the proposed public offering, the Life Insurance Corporation is asking its policyholders to update their PAN.
LIC of India focuses on promoting the importance of life insurance to the rural areas and the socially and economically disadvantaged. The company offers financial protection against death to such individuals at a reasonable cost.
It has around 1.14 lakh employees in India, as well as abroad in Fiji, Mauritius and the UK. LIC offers many types of insurance policies. It has a market share of around 69% in the insurance industry. The company is more than just an insurance provider: they also provide housing finance, pension funds, mutual funds and card services. They are majority partners in IDBI bank, too. With more than 20 private life insurance agents in the country, LIC has around 13.53 lakh agents.
The government hopes to raise Rs 1.75 lakh crore from minority stake sales and privatization of LIC in the current fiscal, making it India’s biggest IPO. According to the proposed plan, policyholders would be entitled to receive up to 10 percent of the IPO issue size.
The Corporation needs policyholders’ PAN details to participate in the public offering. “The only way to subscribe to a public offering in India is to hold a DEMAT account,” LIC stated in a public notice.
LIC has advertised for policyholders to update their Permanent Account Number as it is important to know the customer participating in the proposed public offering, as and when it occurs. If the policyholder does not have a valid DEMAT account, he or she should consider opening one at their own expense.
LIC’s disinvestment was approved by the Union Cabinet in July 2021, and a panel headed by the finance minister has been tasked with deciding on the stake dilution.
Nirmala Sitharaman, Finance Minister, said LIC would be listed in 2021-22 in her Budget speech this year. Finance Act 2022 already contains the required legislative amendments to the LIC Act for the proposed IPO. In the event of a successful LIC IPO, the rupee would rise, the fiscal deficit would be reduced and the rating agencies would take a favorable view of it.
