The Life Insurance Corporation of India (LIC) hopes to earn Rs 50 billion ($1.3 billion) in three months from its

proposed unit-linked health insurance policy. The target is much higher than the Rs 32 billion earned by all

non-life insurers last fiscal (2006-07). The corporation is waiting for clearance for the product from the

Insurance Regulatory and Development Authority (IRDA). LIC is hoping to launch the policy by Jan 2008 and

achieve its ambitious target.

According to D D Singh, Executive Director, LIC, the target of Rs 50 billion is achievable and LIC has achieved

similar targets earlier.He is betting on LIC’s army of one million agents, bank assurance partners, and its

existing client base.The policy covers a mix of hospital expenses and lump-sum payment towards major

surgeries. On the death of the policyholder, the balance in the investment fund goes to the nominee.

For claims processing, LIC has tied up with third party administrators (TPA) and banks. Once the TPAs process

the claim, they would advice LIC on the claim’s permissibility. The life insurer in turn would advise banks to issue

the claim cheque within 24 hours. Industry experts say health insurance is basically a game of distribution and

life insurers are better placed vis-à-vis non-life players.

They say there are around two million agents chasing individuals to sell life covers, whereas the number of

non-life agents is far lower. Interestingly, much of the health insurance sales logged by non-life insurers are

from active life insurance agents.