Did Nil GST Relief Propel LIC's Inflows to Rs 1,100 Crore?
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Synopsis
LIC's remarkable Rs 1,100 crore inflows on the first day post-GST elimination signal robust investor interest, indicating a promising shift in the insurance sector. As policies become more affordable, the potential for increased sales grows, showcasing LIC's resilience and market dominance.
Key Takeaways
- LIC's inflows reached Rs 1,100 crore on the first day post-GST removal.
- Traditional life insurance policies became more affordable for consumers.
- LIC reported a 3.91% increase in net profit for Q1 FY26.
- The company's market share in first-year premium income exceeds 63%.
- Strategic initiatives are on track to enhance LIC's growth.
Mumbai, Sep 28 (NationPress) The Life Insurance Corporation of India (LIC) experienced a remarkable surge in investor interest on the inaugural day following the government's elimination of goods and services tax (GST) on individual traditional life insurance policies. The insurer reported inflows exceeding Rs 1,100 crore within just one day, as per various reports.
This milestone is particularly noteworthy given that LIC typically garners approximately Rs 5,000 crore in premium income from retail policyholders each month.
The immediate inflows following the tax relief reflect a positive sentiment among policyholders and suggest a potential uplift for the insurance industry.
Experts in the field noted that abolishing GST has rendered traditional life insurance policies more affordable and appealing for individual consumers, likely leading to a surge in sales in the forthcoming months.
Earlier in this financial year, LIC announced a consistent increase in both profit and premium income.
The organization revealed a consolidated net profit of Rs 10,957 crore in the April-June quarter (Q1) of FY26, marking a 3.91 percent rise compared to the same period last year (Q1 FY25).
Additionally, its net premium income climbed by 4.7 percent to Rs 1,19,618 crore, according to disclosures to the exchanges.
LIC remains a dominant force in the life insurance sector, holding a market share of over 63 percent in first-year premium income.
“In the first quarter of this financial year, our overall market share by First Year Premium Income stood at 63.51 percent, and we sustained our leadership in both Individual and Group Business,” stated R Doraiswamy, CEO and MD of LIC, in an exchange filing dated August 7.
“Key components of our strategy, including the enhancement of Non-Par share in Individual business, growth in VNB margin, and expansion of Banca share, are progressing well,” Doraiswamy added.
The company's standalone net profit grew by 5 percent year-on-year to Rs 10,986.51 crore.
Point of View
The removal of GST on life insurance policies presents a pivotal moment for the insurance sector in India. As the largest player, LIC's ability to attract significant inflows showcases consumer confidence and a promising outlook for growth. This move is not just beneficial for LIC, but for the entire insurance ecosystem, potentially leading to a rise in coverage and financial security for many Indians.
NationPress
28/09/2025
Frequently Asked Questions
What is the significance of LIC's Rs 1,100 crore inflow?
The Rs 1,100 crore inflow signifies strong investor confidence and highlights the positive impact of the GST removal on traditional life insurance policies.
How does the removal of GST affect life insurance premiums?
The removal of GST makes traditional life insurance policies more affordable, which is expected to attract more individual buyers and increase sales.
What was LIC's net profit for Q1 FY26?
LIC reported a consolidated net profit of Rs 10,957 crore for the April-June quarter of FY26, reflecting a 3.91% increase year-on-year.
What is LIC's market share in first-year premium income?
LIC holds a market share of over 63% in first-year premium income, maintaining its leadership in the life insurance industry.
What strategies is LIC implementing to enhance its business?
LIC is focusing on increasing its Non-Par share, improving its VNB margin, and expanding its Banca share to strengthen its market position.
