LIC Explores Fintech Venture For Digital Innovation, Guaranteed Returns, Says Chairman

The Life Insurance Corporation of India (LIC), a financial behemoth, is considering the establishment of its own fintech arm. While the finer details are yet to be finalized, the state-run insurance giant aims to leverage technology to enhance customer reach, operational efficiency, and the development of new financial products and services.

LIC Chairman Siddhartha Mohanty outlined the initiative in an interview with PTI, emphasizing the organization's commitment to adopting best-in-class digital initiatives. Dubbed "Project DIVE," the fintech venture seeks to benefit stakeholders, including customers, intermediaries, and marketing personnel.

Currently employing three primary customer acquisition channels-agents, bancassurance, and direct sales-LIC is set to undergo a digital transformation, particularly in claims settlement, loans, and other services. Mohanty envisions a customer-centric approach, stating, "Customers need not come to the office. Sitting at home on his mobile, he can access our required services."

The potential fintech arm is part of LIC's broader digital strategy, aiming to diversify its business model and tap into the vast potential of financial technology. Discussions with potential partners are already underway, with a consultant leading the project to ensure its successful implementation.

In a bid to strengthen its digital footprint, LIC has recently forged partnerships with three fintech companies to facilitate product distribution. The insurance giant plans to introduce three to four new products within the current financial year, emphasizing its commitment to staying at the forefront of innovation.

One of the upcoming products set to hit the market in the first week of December promises guaranteed returns. Chairman Mohanty is optimistic that this feature-loaded offering will create significant traction. The product not only ensures assured returns but also offers a lifelong pension of 10% of the sum assured post-maturity.

Transparency is a key focus of this new product, providing policyholders with clear information about premium payments and returns over a 20 to 25-year period. Additionally, the product offers the flexibility of loan facilities and a premature withdrawal option, adding an extra layer of appeal for potential customers.

Mohanty believes that this guaranteed return product will be mutually beneficial for both policyholders and shareholders. As LIC continues to embrace digital transformation, the combination of technological innovation and customer-centric financial products positions the insurance giant for sustained success in the ever-evolving landscape of the financial industry.