LIC shares gain 1% as insurer plans health insurance stake purchase by March 31

LIC shares rose over 1% to a day’s high of Rs 765.95 on BSE on Wednesday after the state-owned insurer confirmed it is in the final stages of acquiring a stake in a health insurance company, CEO Siddhartha Mohanty said on Tuesday. Without naming the target firm, Mohanty stated that discussions are at an advanced stage, with a deal expected before March 31.

"It is a natural choice for LIC to enter health insurance. Discussions are in the final stage," Mohanty told reporters on the sidelines of the GCA25 event.

He clarified that LIC will not seek a controlling stake (51% or more), and the exact stake size will depend on the board’s decision and valuations.


Currently, life insurers in India are not permitted to offer comprehensive health coverage, including hospitalization expenses. While there have been discussions about introducing a composite insurance license, the Union Budget did not announce any regulatory changes in this regard.

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According to media reports, LIC is considering acquiring a stake in ManipalCigna for approximately Rs 4,000 crore.

Meanwhile, Mohanty acknowledged a slowdown in life insurance growth, particularly in terms of penetration, despite efforts to enhance insurance facilitation and shift towards a principle-based regulatory framework.

"This dual reality calls for a comprehensive review of LIC’s approach," he said.

He emphasized that actuaries will play a crucial role in navigating these challenges, offering data-driven insights into emerging risks, developing innovative solutions, and ensuring the financial stability of insurance companies.

In Q3 FY25, LIC reported a 9% decline in net premium income at Rs 1.06 lakh crore, while its standalone net profit rose 17% to Rs 11,056 crore.

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Department of Financial Services Secretary M. Nagaraju highlighted the role of actuaries in reducing insurance premiums by adopting scientific risk assessment methods.

"This will help increase insurance penetration in the country, which currently stands at 3.7%, significantly lower than the global average of 7%," he added.

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