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As Siddhartha Mohanty, chief executive officer and managing director of Life Insurance Corporation of India, prepares to retire, he leaves on a strong note, steering the insurer through a year marked by improved profitability, record policyholder bonuses, and product innovation. Notably, LIC’s Value of New Business margin rose by 80 basis points to 17.6% in financial year 2025, and the company is now targeting a further 200–300 bps increase, aiming for 20% by fiscal 2026.
This improvement is largely driven by LIC’s continued strategic shift towards non-participating (non-par) products, which offer higher margins compared to traditional par offerings. Non-par now comprises nearly 28% of LIC’s product mix.
However, Mohanty emphasised that LIC would not abandon its traditional strength in participating (par) policies, which still represent over 72% of the portfolio. LIC recently declared its highest-ever bonus of over Rs 56,000 crore for par policyholders, underscoring the segment’s importance.
Mohanty acknowledged the challenges faced due to product replacement regulations, which caused temporary disruptions in growth. However, the corporation regained momentum in the fourth quarter of financial year 2025, particularly in March. While annualised premium equivalent and embedded new business premium growth were subdued, LIC managed to record a 6.45% increase in first-year premiums, outperforming much of the industry.
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