You can buy insurance from your favorite insurer LIC via IDBI Bank too now; shares jump 3% on deal
What has happened is that LIC has entered into a service level agreement, where it has decided to sell its insurance through IDBI Bank's branches as well.
The share price of IDBI Bank surged over 3% after the bank signed an agreement with Life Insurance of Corporation (LIC) which is the largest insurance service provider in India. At around 1106 hours, IDBI Bank's shares were trading at Rs 42.95 per piece up by 3%. However, it has touched an intraday high of Rs 43 per piece on the index. What has happened is that LIC has entered into a service level agreement, where it has decided to sell its insurance policies through IDBI Bank branches as well.
This move will strengthen IDBI's insurance products portfolio, as LIC is among the most preferred insurer for availing these schemes. Hence, customers of LIC can now also visit IDBI for opening an insurance account. Also, the bank's revenue will see a major boost.
Rakesh Sharma, MD & CEO, IDBI Bank said, “We are delighted to go into this partnership with LIC. It offers us the chance to give our clients the stellar insurance products which will deal with their protection and saving needs. Since client centricity shapes the core mission of both the organizations, it will be a mutually beneficial association and we are looking forward to working closely with LIC.”
Hemant Bhargava, Chairman, LIC said “ IDBI Bank is fundamentally strong, having a young, energetic and talented work-force who will help in selling the LIC products. This will enable the Bank to add to its revenue growth and simultaneously help LIC in increasing its Bancassurance business. It’s a win-win situation for both the organisations”.
Here's how you IDBI Bank will now offer LIC insurance plans.
The bank will work as Corporate Agent of LIC, and would get a window to provide LIC’s entire gamut of insurance offerings to the Bank’s 1.80 crore customer base spread over 1800 branches across the country.
Additionally, the Bank will become the preferred bank for LIC premium payments and also function as premium point to boost sale of LIC products thereby gaining from fees and float income.
Currently, IDBI Bank's sizeable presence in the rural and semi-urban areas will help to penetrate LIC’s product offerings. Also, its diversified product base would enable targeting the HNI customers in Metro and Urban areas.