Presently many public-sector banks have collaborated with private-sector Insurance-companies for providing single-window service for banking and insurance. This wrong practice should be replaced by promoting public-sector LIC of India by terminating collaborations by all public-sector banks with private-sector Insurance-companies. Instead all branches of various public-sector banks should be authorized as agents for public-sector LIC of India by giving lucrative incentive-points to branch-managers and bank-employees bringing new policies. Even special LIC counters can be opened at select branches of various public-sector banks.
Such a system will enable public-sector LIC of India to expand business manifolds that too by reducing number of LIC branch-offices thus saving a lot on operating-expenses. At the same time, LIC of India then can make a drastic cut in commission-rates which are mostly paid-back by LIC agents to customers out of competition. For example, many new policy-holders manage to get pay-back of even more than two-percent on single-premium policies like Jeevan-Akshay, where no such pay-back is feasible in similar single-premium policy Pradhan Mantri Vaya Vandana having low commission of just half-percent.
Promoting public-sector is in larger public-interest to save general public from gimmicks of private-sector banking and insurance.
MADHU AGRAWAL