‘Keeping policyholders’ interests at forefront’: LIC clarifies on Rahul Gandhi’s concern over new IRDAI rules

State-owned Life Insurance Corporation of India (LIC) on Thursday issued clarifications on concerns raised by leader of opposition Rahul Gandhi regarding new Insurance Regulatory and Development Authority of India (IRDAI) rules. The insurance behemoth in a statement said that the company has introduced products that align with the new product regulations set by IRDAI, keeping policyholders’ interests at the forefront.

The clarification came a day after Rahul Gandhi on March 19 met a delegation of LIC of India agents and discussed recent changes in regulatory norms. The LIC agents raised concerns the new rule would make insurance less affordable for the poor and marginalised communities and also weaken the position of agents.

"I met a delegation of LIC agents from around the country at Parliament House. They spoke candidly about their concerns regarding recent changes in rules by IRDAI and LIC, which make insurance less affordable for the poorest and most marginalised communities and weaken the position of agents," the former Congress president said in a post on his WhatsApp channel.

Gandhi said that the LIC was formed in 1956 with the aim to provide affordable insurance to all Indians and assured agents that he will raise this issue in Parliament to ensure the inclusive vision of the LIC is protected.

Focused on reaching rural areas and economically weaker sections: LIC MD

Responding to these concerns, Siddhartha Mohanty, CEO & MD, LIC of India, said, “We want to clarify that LIC has introduced products that align with the New Product Regulations set by IRDA, effective from October 1, 2024, keeping policyholders’ interests at the forefront.”

“Committed to broadening life insurance coverage, LIC has consistently focused on reaching rural areas and economically and socially disadvantaged sections. Our aim is to extend financial protection to every insurable individual at an affordable cost,” Mohanty said.

“With a diverse portfolio catering to various customer segments and different strata of society, LIC fully complies with all regulatory requirements. As an example, our Micro Bachat plan offers a minimum sum assured of ₹1 lakh and is exempt from GST, ensuring accessibility. Post changes in product regulations, the commission has not been reduced for agents, it has been given in staggered manner,” he explained.

“LIC remains dedicated to providing financial security to its policyholders while also supporting the well-being of its agency force,” Mohanty added.

Meanwhile, shares of LIC of India were trading 0.26% lower at ₹775.05 on the BSE, with a market capitalisation of ₹4.9 lakh crore. Snapping three sessions gaining streak, the insurance heavyweight declined as much as 1% to ₹769.40 in the first two hours of trade so far.

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