Life Insurance Infra
Most people who deal with life insurance come down to one conclusion…there is SERIOUSLY only one life insurance product worth buying: Online Term Life Insurance – from the cheapest company that you can trust.
So lets assume that you get a SBI Term Life Insurance (for your age and term) for Rs. 10,000 p.a. and the LIC policy..term life @ Rs. 16,000.
Should you pay the premium (cut all the CSR crap, processing delays, 60 years experience, ……).
PERSONALLY I DID NOT. I chose a company different from LIC. The fact is that company too has huge, huge, huge infra costs…..
Now for just that ONE USEFUL PRODUCT…look at LIC’s infra…it i s goodamn JOB CREATOR…NOTHING else….
Today,the LIC has 8 zonal offices, around 113 divisional offices, 2,048 branches and 1381 satellite offices and corporate offices;[1] it also has 54 customer zones and 25 metro-area service hubs located in different cities and towns of India. It also has a network of 1,337,064 individual agents, 242 Corporate Agents, 89 Referral Agents, 98 Brokers and 42 Banks for soliciting life insurance business from the public.
As on 31 March 2014, LIC had 1,20,388 employees, out of which 24,867 were women (20.65%).
| Category of employees | Total Number | No. of Women |
|---|---|---|
| Class-I Officers | 31,420 | 6,297 |
| Class-II Development Officers | 26,621 | 1,033 |
| Class III/IV employees | 62,347 | 17,542 |
| Total | 1,20,388 | 24,867 |
Agency strength
LIC had 11,95,916 agents as on 31 March 2014, out of which the number of active agents were 11,32,677 (94.71%)
The corporation, which started its business with around 300 offices, 5.7 million policies and a corpus of INR 45.9 crores (US$92 million as per the 1959 exchange rate of roughly ₹5 for US$1),[5] had grown to 25,000 servicing around 350 million policies and a corpus of over₹800,000 crore (US$120 billion) by the end of the 20th century.
VE
When LIC buys into the market, news spreads and we know where the LIC money is going into.
Where is SBI/HDFC Insurance’s money going?
LIC’s infra might be large, but they also pay out big commissions, which keeps the policies coming in.
Personally, i’ve opted for non-LIC term Policy.
Back in the day, people didn’t know of options, and the LIC brand stood out, so i don’t blame our parents falling for it.
The only reason i’m disgusted with LIC is because i see ill-educated people (that too friends and relatives) coercing you to buy policies they know nothing about vis-a-vis even the alternatives, just for their own commissions.
An SB account would’ve given the middle-class better returns.
Having said that, I know people who have taken LIC International’s policies, purely as a $ hedge. So thats a decent investment.
Kamal Garg
LIC exists for three reasons only:
1. To keep on giving salaries to its vast employee base – more than 1.25 lakhs.
2. To keep on giving commission and steady income to its vast base of agents – more than 11 lakhs. The amount of commission earned by agents is humongous and at the cost of policy holders’ hard earned money. Often it is accused that agents misguide their clients and it is only the clients who suffer. An agents earns 35% commission in first year, 15% in second year and 5% thereafter in perpetuity. Whereas policy holder who has put his/her hard earned money, gets roughly 6% kind of return. This is completely unacceptable.
3. It is a ready market for government securities and borrowings which is also a wrong reason for the existence of LIC.
Jitu
I did buy a LIC, but that was before I met Subra 🙂
Since then I have been the bad boy in family and have rejected all requests to buy any LIC product from anyone in family or outside.