Excelsior Correspondent
JAMMU, July 14: India’s largest insurer, Life Insurance Corporation of India’s (LIC) Indian embedded value (IEV) has been finalized at Rs 5.41 crore as on March 31, 2022, as compared to Rs 95,605 crore as on March 31, 2022.
The Board of LIC, in its meeting, adopted the IEV Report of Milliman Advisors LLP pertaining to the IEV of LIC of India as on March 31, 2022.
The Board of Directors of Life Insurance Corporation of India (“LIC”) approved the Report on Indian Embedded Value (IEV) as on March 31, 2022. As mandated under the amended section 24 of LIC Act, 1956, Board of LIC in its meeting held on 8th January, 2022 had approved bifurcation of the single fund into separate Par and Non-Par funds and the effect of such bifurcation has been reflected in the Financials as at 31st March, 2022.
The Embedded Value (EV) is the measure of the consolidated value of shareholders’ interest in the life insurance business. It represents the worth of shareholders’ interests in the earnings distributable from the assets allocated to the business after sufficient allowance for the aggregate risks in the business.
The Value of LIC’s New Business for year ended March 31, 2022 has been determined to be Rs 7,619 Crore as compared to Rs.4,167 Crore for the year ended March 31, 2021. The VNB margin as on March 31, 2022 improved to 15.1% as compared to 9.9% in the year ago period.
The Annualised Premium Equivalent (APE) for year ended March 31, 2022 is Rs. 50,390 crore compared to Rs 45,588 crore for year ended March 31, 2021 and the APE considered for arriving at VNB for period ended March 31, 2021 was Rs. 42,170 crore
LIC said the APE of Individual business and Group business was Rs 35,572 Crore and Rs 14,818 Crore respectively for FY22-end and therefore, the Individual Business accounted for 70.59% of APE and Group business accounted for 29.41% of APE.
Also, within the individual business, the par business share on APE basis was 92.88%, while the remaining 7.12 % was from the non-par business, the statement read.
The insurance giant reported the return on embedded value (ROEV) to be 11.9% for Mar’22 as compared to 36.9% for March 2021. It is clarified that these calculations take into account the bifurcation impact of the split of single life fund into par and non-par fund during the FY 2021-22.
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