The Life Insurance Corporation (LIC) declared a bonus of Rs 70 for all lifetime plans in lot of Rs 1,000 assured. The Insurance Corporation also announced 22 per cent growth in valuation surplus. Valuation surplus is calculated as the money left with LIC after deduction of all taxes and costs. This surplus is divided between policy holders and the government. Government will get 5 % of this Rs 15,127 crore.

The LIC Chairman, Mr T S Vijayan informed in a press conference that for the financial year 2007, the policyholders will get Rs 14,370.85 crore compared to Rs 12,404.82 crore last year. With growth touching 22 percent, LIC is heading towards better times. The bonus for Jeevan Tarang policyholders for less than 20-year accumulation has been raised to Rs 48 per Rs 1 ,000 assured compared to Rs 32 last financial year.

The benefit will be also be allocated to Jeevan Anurag, Jeevan Madhur and many other policies.

Mr. Vijayan said, "Business composition is changing significantly from non-linked products to linked products." The growth in Unit Linked Insurance Policies (ULIPs) was much higher compared to traditional insurance products. LIC has major share of 80 per cent premium from various ULIP schemes. The numbers are quite impressive compared to many new investment plans in the market and taking into account the tough competition in insurance sector.

Report by Insurance & Banking expert Harish Dhawan. The writer can be contacted at harish.dhawan<at>topnews.in