On-line exclusive booking of new LIC Tech-Term plan 854 (UIN – 512N333V01) will save lot on commission, but should also be available through all branches of public-sector banks
It refers to public-sector LIC of India for the first time booking a new LIC Tech-Term plan 854 (UIN – 512N333V01) available only through on-line booking thereby cutting heavy cost paid to intermediaries as brokerage. Policy has new feature like lower premium for ladies and non-smokers. But since all the probable buyers of the plan may not be knowing or access to internet, experiment of selling LIC policies including Tech-Term policy should be available through special counters set up at all branches of various public-sector banks with nominal commission of half-percent.
Presently nominal commission of just .05-percent is being given to intermediaries on single-premium Pradhan Mantri Vaya Vandana Yojna (PMVVY) plan available through LIC of India exclusively for senior citizens with an upper one-time investment-limit of rupees 15 lakhs. However benefit of exemption under section 80C of Income Tax Act should also be provided on investment in PMVVY also.
It is significant that LIC of India pays heavy commission of two-percent or even more on other single-premium pension-plans normally available for every one without any upper investment-limit Jeevan Akshay and Jeevan Shanti. It is quite usual that brokers pay back even upto 2.5-percent on investment in these single-premium plans. Funds so saved in reducing commission on this and other LIC plans to half-percent can be passed on to customers.
All branches of public-sector banks should be compulsorily linked to some unit of LIC of India for promoting public-sector LIC of India, like is done by private banks offering insurance-policies. Partnership of public-sector banks with LIC of India will promote banking and insurance in public-sector with cost-cutting in paying heavy commission to brokers by LIC of India. Generating insurance-business for LIC of India should be one of the factors judging performance of bank-managers.
MADHU AGRAWAL