# Life Insurance Corporation
The Life Insurance Corporation of India (LIC) is a statutory, government-owned Indian life insurer created on 1 September 1956 by amalgamating the country's private life insurance companies, and it holds the largest market share of first-year premium income and group business among Indian life insurers[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069).
| Key fact | Detail |
|---|---|
| Statutory basis | Life Insurance Corporation Act, 1956 (Act No. 31 of 1956, enacted 18 June 1956); Corporation constituted 1 September 1956[2](https://www.indiacode.nic.in/handle/123456789/1632?sam_handle=123456789%2F1362&view_type=browse) • [3](http://indiankanoon.org/doc/1643240/) |
| Sovereign guarantee | Sums assured by all policies, including declared bonuses, are guaranteed as to payment in cash by the Central Government (Section 37)[4](https://financialservices.gov.in/sites/default/files/Act-Policies/2026-01/LIC-ACT-1956-AS-AMENDED-2021.pdf) |
| Scale (FY 2024–25) | Total assets ₹56.23 trillion (₹5,622,929.99 crore); life fund ₹47.85 trillion (₹4,784,941.86 crore); 261.5 million (26.15 crore) individual policies in force[5](https://www.licindia.in/the-particulars-of-lic) |
| AUM (31 March 2026) | ₹57.29 trillion (₹5,729,396 crore), up 5.08% year on year[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990) |
| Market share (FY26) | 56.66% of first-year premium; 70.11% in group business[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069) |
| Solvency ratio | 2.35 as of 31 March 2026, against the IRDAI minimum of 1.50[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069) • [7](https://gyansurance.com/lic-vs-private-insurer-data-comparison) |
| Distribution | 1,457,045 agents (31 March 2026); 98.42% of FY26 policies sold through the agency channel[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990) |
| FY26 profit | ₹574.2 billion (₹57,419 crore), up 19%, with a ₹10 final dividend and a 1:1 bonus issue[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069) |
## What the LIC is and how it is constituted
LIC owes its existence to a two-step nationalization. An Ordinance issued on 19 January 1956 nationalized the life insurance sector, and the Life Insurance Corporation Act followed; the [Corporation](https://www.edgepedia.org/corporation) then absorbed 154 Indian insurers, 16 non-Indian insurers, and 75 provident societies, 245 entities in all[8](https://policyholder.gov.in/en/web/guest/evolution-of-insurance). The Act's Statement of Objects and Reasons gave three grounds: absolute security for policyholders, spreading insurance much more widely, particularly to rural areas, and more effective mobilization of public savings[3](http://indiankanoon.org/doc/1643240/). Prime Minister Jawaharlal Nehru told Parliament that "The nationalisation of life insurance is an important step in our march towards a socialist society"[9](https://www.orfonline.org/index.php/expert-speak/42999-70-policies-nationalisation-of-life-insurance-1956).
**The charter's protections.** Three provisions of the Act still define the institution. Section 6 makes it the Corporation's general duty to carry on life insurance business, in or outside India, to the best advantage of the community[4](https://financialservices.gov.in/sites/default/files/Act-Policies/2026-01/LIC-ACT-1956-AS-AMENDED-2021.pdf). Section 37 guarantees as to payment in cash, by the Central Government, the sums assured by all policies issued by the Corporation including any bonuses declared[4](https://financialservices.gov.in/sites/default/files/Act-Policies/2026-01/LIC-ACT-1956-AS-AMENDED-2021.pdf). Section 38 provides that the Corporation cannot be placed in liquidation save by order of the Central Government[4](https://financialservices.gov.in/sites/default/files/Act-Policies/2026-01/LIC-ACT-1956-AS-AMENDED-2021.pdf). LIC is governed by the Insurance Act 1938, the LIC Act 1956, the LIC Regulations 1959, and the IRDA Act 1999[10](https://financialservices.gov.in/public-sector-insurers).
LIC held a monopoly on life insurance until the late 1990s, when the sector was reopened to private competition[8](https://policyholder.gov.in/en/web/guest/evolution-of-insurance). The number of life insurance companies in the Indian market rose from 1 in 1999–2000 to 24 in 2020–21[11](https://journals.sagepub.com/doi/full/10.1177/09726225241282448).
## Scale and business model
LIC's balance sheet is large by any national standard. For FY 2024–25 it reported total income of ₹8.814 trillion (₹881,434.07 crore), total premium income of ₹4.881 trillion (₹488,148.17 crore), payments to policyholders of ₹4.164 trillion (₹416,354.69 crore), a total life fund of ₹47.85 trillion (₹4,784,941.86 crore), and total assets of ₹56.23 trillion (₹5,622,929.99 crore)[5](https://www.licindia.in/the-particulars-of-lic). Business in force at 31 March 2025 comprised 261.5 million (26.15 crore) individual policies with sum assured of ₹73.1 trillion (₹7,309,745 crore), plus 92.1 million (9.21 crore) group lives with ₹33.35 trillion (₹3,334,861.92 crore)[5](https://www.licindia.in/the-particulars-of-lic). [Assets under management](https://www.edgepedia.org/assets-under-management) stood at ₹57.29 trillion (₹5,729,396 crore) on 31 March 2026, a 5.08% increase over the year[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990). The network comprises: 1 central, 8 zonal, 113 divisional, 2,048 branch, 1,584 satellite, and 1,168 mini offices[5](https://www.licindia.in/the-particulars-of-lic).
**An agency-dominated model.** LIC's distribution remains overwhelmingly agent-based. Its individual agency force numbered 1,457,045 agents at 31 March 2026, down from 1,486,851 a year earlier, and the agency channel sold 98.42% of FY26 policies and generated 91.75% of new business premium[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990). In FY 2024–25, 93.86% of LIC's individual new business came through agents, against 49.66% through bank branches and 17.09% through direct sales for private insurers; online sales were 0.53% of LIC's business versus 1.07% for the private sector[7](https://gyansurance.com/lic-vs-private-insurer-data-comparison).
Digital channels are growing from a small base. Bancassurance and alternate channels collected ₹50.76 billion (₹5,076 crore) of new business premium in FY26, up 45.19% from ₹34.96 billion (₹3,496.10 crore), with alternate channels alone growing 109.36% to ₹19.25 billion (₹1,924.74 crore); their share of individual new business premium rose to 7.51% from 5.59%[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990). The ANANDA digital onboarding app completed 2,300,983 policies in FY26, up 56.08% from 14,74,208, and LIC launched the MyLIC customer app and the LIC Super Sales Saathi intermediary app on 15 April 2026[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990).
## By the numbers
LIC's Indian embedded value, a measure of the present value of future profits from in-force business plus net assets, was ₹7.892 trillion (₹789,185 crore) at 31 March 2026, up 1.58% from ₹7.769 trillion (₹776,876 crore) a year earlier[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990). FY26 profit rose 19% to ₹574.2 billion (₹57,419 crore), and the board recommended a final dividend of ₹10 per ₹10 equity share, equivalent to ₹20 per share before the 1:1 bonus issue[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069). The solvency ratio, the ratio of available to required capital, improved to 2.35 from 2.11, and the expense ratio declined 51 basis points to 11.91%[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069). LIC sold 18,441,175 new policies in FY26, a 3.7% increase on the previous year[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990).
## How it compares with private Indian insurers
[Market share](https://www.edgepedia.org/market-share) has drifted down since liberalisation. LIC's share of first-year premium slipped to 56.66% in FY26 from 57.05%, though it retains 70.11% of group business[1](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069). The longer arc is steeper: one appraisal found LIC's relative market share fell from 100% before liberalisation to about 48% in regular premium and over 74% in overall premium by 2008[12](https://www.saudijournals.com/media/articles/SJBMS-26633-642.pdf).
**Claims and grievances.** On claim settlement, private insurers overtook LIC by count in FY 2023–24 (99.00% versus 98.24%) and widened the lead in FY 2024–25 (99.17% versus 98.15%); by amount the two are at near-parity, 97.18% private versus 97.19% LIC[7](https://gyansurance.com/lic-vs-private-insurer-data-comparison). LIC processed 848,145 death claims in FY 2024–25 against 163,735 for all private insurers combined, but the average private claim of ₹788,000 (₹7.88 lakh) was 3.2 times the average LIC claim of ₹245,000 (₹2.45 lakh)[7](https://gyansurance.com/lic-vs-private-insurer-data-comparison). On grievances, LIC reported 74,104 complaints in FY 2024–25 versus 46,325 for the private sector, yet resolved 100% with zero closing balance, while private insurers carried 554 unresolved at year-end[7](https://gyansurance.com/lic-vs-private-insurer-data-comparison).
On solvency, LIC improved from 1.76 in March 2021 to 2.19 in December 2025, partly driven by the 2022 IPO recapitalisation, against a private sector average of 2.26; both sit above the IRDAI minimum of 1.50[7](https://gyansurance.com/lic-vs-private-insurer-data-comparison). A 2024 academic analysis of Indian life insurers cites [HDFC Life](https://www.edgepedia.org/hdfc-life)'s high claim settlement ratio, consistent profitability, and robust solvency position as evidence of financial stability among the stronger private players[13](https://link.springer.com/article/10.1007/s44282-024-00122-z).
## Role beyond insurance
LIC remains government-owned, with statutory objectives that include spreading life insurance into rural and socially backward areas and mobilizing people's savings[14](https://businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/2686/im_en_2009_2_R.Rajendran.pdf). It also functions as a holding company: it owns 49.24% of IDBI Bank Limited, 45.24% of LIC Housing Finance Limited, and 49% of LIC Mutual Fund Trustee Private Limited[5](https://www.licindia.in/the-particulars-of-lic).
Think-tank commentary has questioned the financial consequences of this dual role. ICRIER's working paper noted that LIC's yield, the return on its investments, fell to 7.59% in 2018–19 from 7.71% the previous year per LIC's public disclosure, and argued that the wobbly finances of an insurer commanding LIC's market share can cast a pall over the sector[15](https://icrier.org/pdf/Working_Paper_394.pdf).
## Recent developments
The FY25–FY26 record shows steady operations with continued share drift. LIC's product shelf at 31 March 2026 comprised 58 products excluding PMJJBY: 36 exclusive individual products, 13 exclusive group products, one common product, seven individual riders, and one group rider; the Nav Jeevan Shree Single Premium plan was withdrawn after 31 March 2026[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990). The agent count fell and the agent channel's share of the national agent market slipped from 47.61% to 44.25%, while bancassurance and digital onboarding grew quickly from a small base[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990). In FY26 LIC processed 24,956,342 claims, including 24,125,943 maturity and survival claims; total maturity claims were ₹2.8 trillion (₹279,951 crore) and death claims ₹248.8 billion (₹24,885 crore)[6](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990).
## References
1. [LIC profit rises 19% to ₹57,419 crore in FY26; announces ₹10 dividend, 1:1 bonus issue, Fortune India](https://www.fortuneindia.com/business-news/lic-profit-rises-19-to-57419-crore-in-fy26-announces-10-dividend-11-bonus-issue/139069)
2. [India Code: Life Insurance Corporation Act, 1956](https://www.indiacode.nic.in/handle/123456789/1632?sam_handle=123456789%2F1362&view_type=browse)
3. [The Life Insurance Corporation Act, 1956, full text with Statement of Objects and Reasons, Indian Kanoon](http://indiankanoon.org/doc/1643240/)
4. [The Life Insurance Corporation Act, 1956 (as amended 2021), Department of Financial Services](https://financialservices.gov.in/sites/default/files/Act-Policies/2026-01/LIC-ACT-1956-AS-AMENDED-2021.pdf)
5. [The Particulars of LIC, official LIC website](https://www.licindia.in/the-particulars-of-lic)
6. [LIC Earnings Call Transcript FY26 (May 21, 2026)](https://licindia.in/documents/20121/239450/Transcript+LIC+Earning+FY26.pdf/4c17e0db-b1bc-0f1a-c91b-7330e5f2db7e?t=1779958963990)
7. [LIC vs Private Life Insurers: Data-Backed Comparison (citing IRDAI Handbook FY 2024-25), Gyansurance](https://gyansurance.com/lic-vs-private-insurer-data-comparison)
8. [Evolution of Insurance, IRDAI](https://policyholder.gov.in/en/web/guest/evolution-of-insurance)
9. [70 Policies — Nationalisation of Life Insurance, 1956, Observer Research Foundation](https://www.orfonline.org/index.php/expert-speak/42999-70-policies-nationalisation-of-life-insurance-1956)
10. [Public Sector Insurers, Department of Financial Services](https://financialservices.gov.in/public-sector-insurers)
11. [Ram Pratap Sinha (2025). The Impact of Contextual Variables on Life Insurer Performance. SAGE journal](https://journals.sagepub.com/doi/full/10.1177/09726225241282448)
12. [New Business of LIC of India under Individual Assurance in the 21st Century: An Appraisal, Saudi Journal of Business and Management Studies](https://www.saudijournals.com/media/articles/SJBMS-26633-642.pdf)
13. [A historical analysis of life insurance's contribution to India's economic development, Discover Global Society (2024)](https://link.springer.com/article/10.1007/s44282-024-00122-z)
14. [R. Rajendran (2009). The impact of LPG on Life Insurance Corporation of India. Business Perspectives](https://businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/2686/im_en_2009_2_R.Rajendran.pdf)
15. [ICRIER Working Paper 394 (Saon Ray)](https://icrier.org/pdf/Working_Paper_394.pdf)
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*Topic: Encyclopedia › Society and history › Economics and business › Finance › Insurance*
*Initially written Sep 17, 2026 · Reviewed: Sep 17, 2026; Sep 30, 2026; Oct 10, 2026 · Edited: Sep 30, 2026; Oct 10, 2026; Oct 11, 2026; Oct 15, 2026; Oct 21, 2026 · Last review: Oct 10, 2026*
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