InvestorQ : What happens to the control of LIC after the government sells stake in the life insurer, as per the Union Budget announcement?
Moii Chavate made post

What happens to the control of LIC after the government sells stake in the life insurer, as per the Union Budget announcement?

Answer
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Sam Eswaran answered.
6 months ago


Nirmala Sitharaman has reiterated that government will retain management control of LIC and safeguard the interest of policyholders even after listing the insurer on the stock exchanges. There were questions raised after LIC divestment was announced by the FM in the Union Budget 2020. Sitharaman also clarified that the IPO would be issued only after necessary legislative changes and regulatory approvals. These pertain to distribution of surplus, amendment to LIC Act etc. The FM highlighted that LIC had a market share of 77.61% in terms of number of policies and 70.02% in terms of first year premium income. These were clearly formidable numbers. LIC has improved its share in the last one year. This should come as a relief for existing policyholders, who were worried about the government ceding control to private management post the LIC IPO.