LIC is Govt or Private Insurance Organization ?

POSTED BY somasekhararaom ON June 6, 2012 8:11 pm COMMENTS (46)

Hi to all,

Yesterday one agent met me from LIC to sell Jeevan Saral & Anand combo pack, but I didn’t buy. He was saying that LIC is Govt insurance Organization and if I buy any insurance product from private players, I will lose money. I don’t believe him because he showed me one table regarding Jeevan Saral. But its different in LIC website.

My query is what are the govt insurance companies in India? What about LIC ?


46 replies on this article “LIC is Govt or Private Insurance Organization ?”

  1. Mukesh says:

    Kya lic govt. Ki h

  2. Lic is a government body better to search at Wikipedia because government hold more than 51% share in Lic so it is a public sector unit like banks example- bank of India,corporation bank ,p.n.b,bank of Baroda so don’t be confused. the of of corporation is government of India

  3. sudhir kundu says:

    Is the LIC government of private concern?

      1. Rakesh Bisht says:


        1. Anuradha Singh says:

          Hello Rakesh, LIC is a pure government organization.

          Thank You

  4. Satwant chauhan says:

    Before believing on any insurance company first checkout there market share and there claim ratio. And claim ratio of Lic is 99.8% and others are below 55% because they are unable to pay such amount on any mishappenings . And one thing more behind lic their is ministry of finance. When you got bond paper of Lic their you found written as with reference to ministry finance.

    1. If thats the case, why does IRDA say that ICICI and HDFC has claim settlement ratio of 96% and 97% in their report ?

    2. Raj says:

      Let me tell you one thing, no insurance company, i repeat no insurance company is fraud.. all are under the guidlines of irdai..

    3. Bijoy Bose says:

      TATA AIA has 96.8% bro.. you know where is the problem?
      LICI employees brain wash their advisors that other companies are bad..
      But every private sector company acknowledge lici and they appreciate their success.. but lici feels so jealous if any other company succeeds.

  5. MEET says:

    if we think the LIC is the Government Organisation, so by default if Government need money for the development of india, then they can approach for LIC to give money,
    now think our government employee and government is working properly on the development project?
    government = political People = Scandle (s)

    chara ghotala col scandle etc

    now see the little calculation

    lic given XYZ amount for development ( poor people development for housing project )

    total coust is 100 rs.
    midiat 20%
    political person 30%
    Govt emp 10%

    now say what is the actual invest for development? and where is the development?

    1. Thanks for your comment MEET

  6. Dhiraj says:

    My dear friends, dont be confuse LIC is the india’s largest insurance corporation and not a company, and yes it is a goverment organisation if u can’t believe u can check it in its official website or sarkari naukri blog

    1. Rajesh says:

      Lic is not govt. Org.
      Pls. Dont confuse to any one.

      LIC working under IRDA .
      IRDA is Govt. org. Not Lic.
      24 Company’s in India under IRDA.

      1. Chandan says:

        You people just making fiil to other Lic is a government of India Enterprise out of 24 23 is from private sector And Lic is from gov sector just like public sector bank like pnb CBI comes under gov sector bank and icici axis and yes bank

      2. Maddy says:

        Bhai Sahab r u living in this world or another ?
        IRDA is a regulatory body which regulates insurance sector not only Lic
        Los is the largest gov. Owned insurance organisation created by Lic act , 1956.
        Have some basic knowledge .

      3. Vinay Sharma says:

        1. Lic having 100% govt. Stake (any pvt. Comp. Cannt hold any govt. Stake.)

        2. Even lic of india is not listed in sebi for equity trading (but LIC HFL Iis listed i.e. pvt.) So it has 100% govt. Stake.

        3. RBI is regulatory body for banks it dosent means that sbi bank is a pvt bank.

        4. Regulatory body is a different thing and an organisation is a different thing.

        5.Lic of india is same govt. Organisation as like FCI both are autonomous bodies.

      4. Mr. DJ says:

        why all are u making argue first u uderstand Govt. has more than 51% share in LICI and balance share hold by its subsidiary company for that it called public sector and others are private sector if any fraud will hapen govt. is responsible but in private sector no one is responsible as those company is limited by share.

        1. Kishor says:

          You are confused. Lic does not have any share because it is not listed in share market. It is fully owned by Govt of India

  7. biswajit says:

    There are 24 insurance company working on life insurance. All are coming under IRDAI ( insurance regulation and development authority of India ). LIC is not a govt organisation. There is no chance of money loss in any insurance company. Every insurance agent has a licences, which they get from IRDAI after study the insurance law and pass the exam. so before buy a insurance plan, first ask him or her to show his license. before buy a insurance also compare the plan with other company plan. look at their interest, then buy the product.

    1. GANESH says:

      Really this is not a govt company seriously

    2. Vinay Sharma says:

      1. Lic having 100% govt. Stake (any pvt. Comp. Cannt hold any govt. Stake.)

      2. Even lic of india is not listed in sebi for equity trading (but LIC HFL Iis listed i.e. pvt.) So it has 100% govt. Stake.

      3. RBI is regulatory body for banks it dosent means that sbi bank is a pvt bank.

      4. Regulatory body is a different thing and an organisation is a different thing.

      5.Lic of india is same govt. Organisation as like FCI both are autonomous bodies.

  8. Milind says:

    Lack of quality advise is the biggest problem ………many of families underinsured ……….people don’t like to talk about insurance when they are alive ………..when a person dies a premature death …..first question asked is ……insurance tha kya ???? Kitna tha ???? Bus 5 lacs ………….sala gaya to gaya ……….thik se insurance bhi nahi liya biwi baccho ke liye ….bada hi nikamma tha

  9. somasekhar says:

    Hi Ashal,

    Yeah, This may work out. I already decided that i would tell them i have other commitments.


  10. somasekhar says:


    Here the big problem is i know him for the last 20 years and he is our senior in our school, college…… And that too he is captain in our cricket team and childhood’s friend. we have close relationship with his family too.

    I told him that i am not interested in investing in any Insurance + Investments related products. But he came up with the same product, so i said NO.

    But i have many friends who are working as Advisers. I don’t know how to tackle them. Ha Ha


    1. Dear Sekhar, please ask such friends that you really want to purchase a policy from them but the policy choice ‘ll be your’s. Once agreed upon ask for a 30 times multiple of your yly income as Term cover. This way you are not refusing to purchase a policy & not straining your relationship either.

      Try this & inform us. 🙂 🙂



  11. somasekhar says:

    Hi Manish,

    If you write any article on ” How to escape from insurance Agents, Relationship Managers, our boss relatives, friends of friends, our relatives …. Etc “. That would be helpful to all. Even that LIC agent is my childhood friend’s brother whom I met yesterday.

    1. Ramesh says:

      Say ‘NO’ to wrong ill-devised policies. Nothing else will work.
      By letting others flourish / earn at the expense of yourself is called sacrifice. If you want to be a sacrificial goat, then it is your choice, whether Manish writes about that or not will not help anybody.

      It is like ‘Hey friend/relative, although I am a daylight robber, but I want your money which will not give you a good return. Still, because of our relationship, I want you to give it to me, so that I can prosper’. If you cannot understand that, nobody else will be able to.


    2. Dear Sekhar, a plain No save you from a lot of PAIN.



  12. somasekhar says:

    Hi Ashal,

    yesterday I told LIC agent that I will buy a product where I can get at least 15% IRR. So he could not sell me any product.

  13. somasekhar says:

    Hi Ashal,

    Here the funny thing is that agent showed me the table of Jeevan Saral which is having our entire investments process. But i found out another table in LIC Website (I found out it through Jagoinvestor Forum). He was saying that LIC website is not updated and has got wrong statistics.

    I always give importance to cost cutting. So i will buy term plan from Private players because LIC is more expensive.

    LIC investments in ONGC is really a shocking news. Its a good example of How govt ruining top reputation companies. After buying ONGC, LIC lost 1000 Cr within 2 days.

    Coal India is also good example. Recently Govt issued presidential decree to force Coal India for long-term fuel supply to private power firms.


    1. Dear Somasekhar, glad to know that you are able to differentiate the good, bad & ugly. God save that agent. 🙂 🙂



  14. Ramesh says:

    You will lose money, “in the real sense”, if you invest in any insurance product (be it LIC, private, etc). Please keep them separate.

  15. Dear Sekhar, Govt is the promoter of LIC directly so such agents may call LIC as a Govt. insurer. Instead of answering your query directly – I w’d like to ask you –

    SBI Life
    IDBI Life
    Star Union Daitchi
    India First
    Canara OBC HSBC

    & many more insurance cos. are promoted by PSU banks which in turn are again Govt. owned.

    Now think which is Govt & which is private & if you are unable to answer, do not lose heart, put the same question to that LIC agent.



    1. somasekhar says:

      Hi Ashal,

      Thanks for the reply.

      So Govt investing in this company, but it doesn’t have any command on LIC? Govt only getting profits via dividends? Has Govt ever invested in any Private Insurance Company ?

      Hi Ramesh,

      I won’t invest in LIC or any private insurance companies because i am a Jagoinvestor.


      1. Ramesh says:

        Govt is the commander, owner and profiteer of LIC as well as all public sector bank sponsored insurance companies (which Ashal has named above).

        Good. Keep it up.


        1. somasekhar says:


          all my doubts cleared except one thing. Has ever Govt invested in any private Insurance Company ?


          1. Dear Somasekhar, the clear answer is Govt. is the indirect promoter as well as indirect money investor in these Insurance cos. as listed above (You may call it indirect holding). The Govt had invested in the parent banks & these parent banks have invested in these insurance cos.

            How you take these things is up to you. If the ownership of the insurer is more important to you & not the insurance (I’m not discussing the investment part of insurance policies as it’s not advisable to mix these two things – insurance & investment), well my dear friend, please go for pure term plans from LICs.

            By the way – are you aware of the impact of Govt. ownership on LIC in the recently concluded FPO of ONGC & the loss suffered by LIC? Please dig a little deeper to know the benefits of Govt. ownership. 🙂 🙂



    2. rajesh says:

      to all of friend

      i read all the answer now you all see wikipedia and see lic profile owner of lic is govt of india its not promot by govt. its construct as per parliamant act of 1956 ,Insurance Corporation of India (LIC) (Hindi: भारतीय जीवन बीमा निगम) is the largest insurance group and investment company in India. Its a state-owned where Government of India has 100% stake. LIC also funds close to 24.6% of the Indian Government’s expenses.

    3. Singhs says:

      These psu banks have corporate agencies of above listed insurance companies i.e. they becoz they get comissions

    4. raj says:

      Dear Sir, this is to inform you that Lic is a government corporation and it was nationalised in 1956. Any company or corporation in which government share is more then 50% is a government company. Second point which was raised by you, regarding other insurance companies whose PSU are promoters is a private organizations. To be very specific LIC is wholly owned by government of India.

    5. Yogesh says:

      Sir who said lic is not owned by govt and secondly all lic policies have govt gurantee to return money and whether
      this type of gurantee given by private insurance company definitely not if investing money in private is completely waste

      1. Khapangi says:

        Hi everyone
        Don’t be confused, if LIC giving a good feedback to people surrounding near by you than just asked them what policy he/she taken and what amount did they get at return
        If they says accurate amount told by lic agent than comment on it.

        Thanks n regards

        1. Ayan says:

          Firstly,LIC is not a company,its corporation,founded by Govt of India in the year of 1956,by nationalisation. Upto 1999 there was only LIC in insurance field,so there was no regulatory body. But during liberisation govt openned all sectors for private players also,like telecom,power any many other sectors after 1991. Govt allowed private companies in insurance from 2000,IRDA was founded then as regulator. Of course LIC must follow guidelines set by IRDA as other private cos do,but it does not mean LIC is private. Rather,only LIC enjoys sovereign guranty by Govt of India,not even any PSU bank enjoy it. Sum assured and bonus declared by LIC is fully guaranteed by Govt of India. If you are watchful in current affairs,you can notice,LIC chairman is always selected and appointed by Govt of India,Finance ministry. Besides,LIC is largest financial institute in India,contributes 25 to 26% every year in union budget.

          1. s p suresh says:

            yes you are 100% right

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