Life Insurance Corporation of India (LIC) is poised to receive a substantial income tax refund amounting to Rs 25,464 crore, as announced by its chairman Siddhartha Mohanty. The refund, issued by the Income Tax Appellate Tribunal (ITAT) last month, pertains to interim bonuses disbursed to policyholders over the past seven assessment years.
Optimistic Outlook
We are actively pursuing the matter and remain hopeful of securing the refund from the Income Tax Department within this quarter,” Mohanty affirmed during a post-result interaction session.
In addition to the refund, LIC plans to introduce a range of new products during the quarter, including offerings focused on child protection. In the preceding quarter, LIC successfully launched Jeevan Utsav, Index Plus, and other products, thereby elevating its Value of New Business (VNB) margin levels to 16.6 percent.
Financial Performance
The anticipated refund is poised to bolster LIC’s bottom line in the fourth quarter. Notably, the state-owned insurer reported a significant 49 percent surge in net profit to Rs 9,444 crore for the third quarter ended December 2023, compared to Rs 6,334 crore recorded in the corresponding period last year.
LIC’s net premium income also witnessed improvement, climbing to Rs 1,17,017 crore in the third quarter of the current fiscal from Rs 1,11,788 crore reported in the same period a year ago. Moreover, the corporation’s total income rose to Rs 2,12,447 crore in the latest December quarter, marking an increase from Rs 1,96,891 crore in the year-ago period.
Financial Highlights
For the nine-month period ending December 2022, LIC reported a profit of Rs 22,970 crore. However, it is important to note that this figure is not directly comparable, as it includes an amount of Rs 4,542 crore (Net of Tax) attributed to accretions on the Solvency Margin available for the final quarter of 2021-22.
This amount was transferred from the Non-Par fund to the shareholders’ account on September 30, 2022.
Additionally, LIC’s total premium income for the nine-month period ended December 31, 2023, amounted to Rs 3,22,776 crore, reflecting a slight decline from Rs 3,42,244 crore reported in the corresponding period a year ago.
Conclusion
In light of the forthcoming income tax refund and its robust financial performance, LIC remains poised for continued growth and stability in the insurance sector.
