The Hindu Business Line : LIC, Corporation Bank to expand co-operation

MUTUAL GAINS: Mr B. Sambamurthy (right), CMD, Corporation Bank, and Mr T.S. Vijayan, Chairman, LIC, addressing a press conference in Mangalore on Thursday. - R. Eswarraj

Mangalore March 15 Corporation Bank and Life Insurance Corporation of India, who have strategic partnership in various areas of activities, are now planning to focus on new areas of mutual business — reverse mortgage and financial inclusion.

While LIC will provide its expertise on mortgage-related activities in the case of reverse mortgage, Corporation Bank will focus on the retail part of it. A working group has been constituted to work on it in detail.

Addressing presspersons here on Thursday, Mr B. Sambamurthy, Chairman and Managing Director of Corporation Bank, said that coming together of these two institutions on these concepts is a value proposition for the both.

"There is an element of actuarial evaluation and an element of annuity in the case of reverse mortgage. LIC has lot of expertise in these two areas. So, we bank upon LIC for this very critical and technical equity in these two areas," he said.

Working together

Corporation Bank will be the front-end partner for this, as LIC is not in the retail business of mortgage. Mr T.S. Vijayan, Chairman of LIC, said, "We decided to revisit the entire business proposals to create opportunities for both the participants in specialist areas where we are transacting business."

FINANCIAL INCLUSION

Both Mr Vijayan and Mr Sambamurthy said that National Housing Bank is the nodal agency to frame guidelines for the reverse mortgage. "Once they come out with guidelines, probably, we will work out," Mr Sambamurthy said. "We should not take too much time to bring it (reverse mortgage) to the market," Mr Vijayan added.

Mr Vijayan said that both LIC and Corporation Bank would like to take forward the financial inclusion programme. LIC has started micro-insurance product — `Jeevan Madhur' — and tested in several areas. Similarly, other products of LIC will also be taken forward under this programme.

Mr Vijayan said that the LIC hopes to complete the task of digitisation in four years. "We are already servicing more than 20 crore policies. This year we are intending to sell nearly 3.5 crore new policies. This is adding to our paper. So, we thought to digitise them. Once digitised, we will be able to offer service to any branch anywhere in the country," he said.

Asked if LIC intends to introduce dematerialised policy documents on the lines of share documents, he said the Insurance Regulatory and Development Authority has to come into picture for that, as legal issues are involved in it.

Mr T. Thomas Mathew, Managing Director of LIC, and Mr K.L. Gopalakrishna, Executive Director of Corporation Bank, were present on the occasion.

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LIC, Corporation Bank to expand co-operation