As a policyholder, I welcome the government’s move to get Life Insurance Corporation (LIC) listed in the stock exchange as this would make the company more answerable to the investors. As of now, the policyholders’ money is invested in companies without any concern for the business implications, as when LIC was made to buy shares of Coal India and ONGC. This often leads to low bonus to policyholders. Second, the policy portfolios offered are shrouded in secrecy, not revealing the large commissions paid to agents, which again impact the amount of bonus declared. It is reported that the commissions range up to 40% of the first premiums and 5% on subsequent premiums. Converting LIC into a public limited will hopefully change the work culture and provide better yields. Employees threatening to go on strike should spare a thought for the policyholders also (“Govt. to sell part of its stake in LIC via IPO,” Feb. 02).
Jayalakshmi Narayan,
Mangalore
The proposal to disinvest LIC came as a shocker. Senior citizens who have invested their hard-earned money in this prestigious public sector undertaking will surely brood over it. Privatisation may fill the government’s coffers but will shatter public confidence in the company. India’s status as a welfare state would be seriously compromised.
S. Ramakrishnasayee,
Chennai
