Daijiworld Media Network - New Delhi

New Delhi, Mar 18: The Life Insurance Corporation of India (LIC) is set to acquire a stake in a standalone health insurance company by the end of the current financial year (FY25), its Managing Director and Chief Executive Officer, Siddhartha Mohanty, announced on Tuesday.

While Mohanty did not reveal the name of the company in which LIC is planning to invest, he confirmed that discussions are in the final stage. Speaking at the Global Conference of Actuaries in Mumbai, he stated, "We have plans. Discussions are at the final stage. It is a natural choice for LIC to enter the health insurance sector."

He further noted that regulatory approvals take time but expressed confidence that a decision would be made before March 31, 2025. However, he clarified that LIC would not acquire a majority stake in the company.

LIC had previously indicated its interest in the health insurance sector, having stated in the first quarter of FY25 that it was actively looking to invest in a standalone health insurance firm. Currently, India has seven such companies, including Star Health & Allied Insurance, Niva Bupa Health Insurance, Care Health Insurance, Aditya Birla Health Insurance, ManipalCigna Health Insurance, Narayana Health Insurance, and Galaxy Health Insurance.

Beyond its expansion plans in health insurance, LIC has also approached the Reserve Bank of India (RBI) to issue additional long-term bonds. The insurance giant had earlier sought approval for 40-year bonds, which the RBI granted. Now, LIC is in discussions for 50-year and even 100-year bonds.

"We are long-term investors. We have contractual obligations to pay back as per the contract. So, I have to manage investments and asset-liability management properly… Western countries have long-term bonds," Mohanty explained.

The RBI has already introduced 50-year bonds to cater to the increasing demand from insurance and pension funds, aligning with LIC’s long-term investment strategy.