LIC has made a record profit of Rs 42,000 crore from equity sales in FY 2021-22, higher by 16.66 per cent from Rs 36,000 crore in the year ago period.
The rise in profit came despite the stock market showing huge volatility during the financial year. LIC has been a contrarian player in the market.
The corporation which announced its results saw its standalone net profit declining by 18 per cent to Rs 2,371.55 crore in the quarter ended March 2022, compared to Rs 2,893.48 crore in the year-ago period.
However, clarifying on the drop of net profits, Raj Kumar, MD, LIC, said,” Earlier the profits were declared at the end of the year only. So that’s why the quarterly numbers are not comparable. This year’s (FY22) Q4 number is not comparable with the Q4 of last year (FY21) because it was for the full year (FY21).” From September 2022 onwards, the comparable data points will be available, he said.
Kumar said the corporation’s product mix is dominated by the participating (par) business but going further its driver of growth will be non-participating (non-par) business. “We have already decided that in future we will be launching only non-par products. With the product mix changing towards the non-par side in the future at a greater pace than the par side, the value of new business will be created. That is the strategy we are adopting,” he said.
A participating (par) life insurance policy allows policyholders to participate in the profits of a life insurance company, while a non-participating (non-par) plan does not offer any dividend payouts.