Life Insurance Corporation of India (LIC), one of the largest shareholders in the National Stock Exchange (NSE) with a 10.72 per cent stake, may consider increasing its stake in the bourse once the much-awaited initial public offering (IPO) is launched, said its MD & CEO R Doraiswamy in an exclusive interview with businessline. The insurer has already decided against selling shares in the proposed offer-for-sale (OFS), signalling confidence in the long-term value of the exchange.

“We have taken a call not to be a seller. We will look at the process, look at the price and then take a call whether to enhance our stake or not,” Doraiswamy said, indicating that LIC could emerge as a buyer depending on valuations and market conditions. “We invest in stocks that, in our assessment, have the potential to create long-term value. Our size also means we can act as a financial institution and market stabiliser,” he said. LIC’s long-duration liabilities and large annuity book make it a natural long-term investor, supporting its counter-cyclical approach to equity investments.

Rural Reach

Even as it evaluates opportunities in capital markets, LIC’s biggest operational focus remains expanding insurance penetration across the country. The insurer is aiming to establish representation in every village panchayat, building on a network that already covers about 92 per cent of India’s districts and nearly 56 per cent of panchayats.

“One of the objectives for which the corporation was formed is to spread the message of life insurance to every nook and corner of the country,” Doraiswamy said. He stated, “We are identifying panchayats where there is no LIC agent available and ensuring representation there.” LIC expects to make substantial progress towards full panchayat coverage in the next one to two years.

The rural push is being driven through LIC’s agency network, including the Bima Sakhi initiative, under which the insurer has around 2.8 lakh active women agents, helping strengthen last-mile insurance distribution.

While expanding its physical footprint, the life insurer aims to combine its legacy of trust with a more agile, technology-driven operating model that can respond to evolving customer expectations. We need to stay relevant to the current generation by providing solutions that are available at their fingertips,” he said.

Margin Focus

On the business side, LIC is continuing its shift towards higher-margin non-participating products. The share of non-par products has risen sharply from about 7-8 per cent of annualised premium equivalent (APE) at the time of listing to nearly 30 per cent now. “We would like to keep it around 30-35 per cent,” he said.

The insurer is also increasing its focus on protection products while retaining its strengths in savings and annuity businesses. “The protection business has been witnessing strong growth and is expected to become a larger contributor to LIC’s portfolio,” said Doraiswamy.

At the group level, LIC is reviewing the performance of subsidiaries, associate companies and overseas operations to ensure they contribute meaningfully to profitability. “We are a financial conglomerate, and we expect every one of them to contribute to the overall profitability,” he said. Businesses failing to meet expectations are being closely evaluated. LIC has already moved its UK operations into run-off mode and is reviewing its Singapore business as part of a broader effort to improve efficiency and returns across the group.