LIC's much-awaited mega IPO was completed last week. And today, the insurance giant listed its shares in the stock market in what turned out to be a disappointing debut for India's biggest life insurance company.
While this has become a concern for the investors, the details from LIC IPO documents that were filed during its IPO filing process in Feb-March 2022, reveal another aspect of India’s insurance industry.
The amount of money lying unclaimed with insurance giant LIC, i.e. ₹21,539.5 crores, is bigger than the entire budget of not just one but multiple ministries of our country! Yes, you read that right.
Unclaimed amounts include settled claims which haven’t been paid out, sums which become due when policies mature as well as excess amounts paid which are to be refunded. The largest amount due is because of policies matured but where the money hasn’t reached the investor. They account for ₹19,285.6 crores or nearly 90% of the total amount.
The scale of this massive outstanding amount is much higher than the budgets of many central government ministries. It is larger than the budget for the Ministry of Civil Aviation (₹ 10,667 crores), the Ministry of Electronics and Information Technology (₹ 14,300 crores), the Ministry of External Affairs (₹ 17,250 crores) and the Ministry of Environment, Forests and Climate Change (₹ 3,030 crores), as per a Business-Standard report.
As per the close to ₹10,000 crore budget of the first mission of spaceflight Gaganyaan, LIC’s unclaimed funds of over ₹21,000 crores is enough to fund two of such human spaceflight missions of Gaganyaan, as per a TimesofIndia report.
