Life Insurance Corporation of India (LIC) has recently announced a significant increase in the gratuity benefits which is a major development for the agents of the company. The gratuity of Life Insurance Corporation of India (LIC) employees has been increased from Rs. 30 lakhs to Rs. 50 lakhs, marking a significant increase in their financial rewards. This exciting news has been confirmed through a government notification and LIC was quick to disclose the same to the stock market.
Positive Impact of The New LIC Rules:
The new rules, effective from December 6, follow a series of announcements made by the Ministry of Finance (MoF) in September aimed at providing enhanced benefits to LIC agents and employees. The MoF’s measures include not only an increase in the gratuity limit but also changes in the conditions relating to renewal commission and term insurance.The LIC (Agents) Rules, 2017 have been amended to take into account these changes.
One of the key provisions includes an increase in the honorarium limit for LIC agents from Rs. 300,000 to Rs. 500,000, which will significantly boost their financial income. The Finance Ministry’s approval in September contained various welfare measures emphasizing the welfare of LIC agents and employees. The restoration of renewal commissions is expected to significantly reduce the burden on agents and enable them to benefit from the business they previously represented.
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Additionally, LIC recognizes that reappointed agents are entitled to renewal commissions, addressing a loophole in the previous rule. The revised rule entitles agents to renewal commissions from business generated by their former agents, which helps to significantly increase their overall income.
Comprehensive Coverage
In addition to these changes, the term insurance coverage for agents has been significantly expanded from Rs. 3,000 to Rs. 10,000 to Rs. 25,000 to Rs. 1,50,000 for a more comprehensive coverage. This significant increase is aimed at providing higher security to agents and their families. In addition, the Ministry of Finance has also approved a 30% family pension for the family members of LIC employees to provide additional financial security.
These reforms will benefit more than 13 million LIC agents and more than 100,000 employees, recognizing the important role agents play in driving the expansion of LIC business. With the new rules in effect, LIC agents will have much to celebrate, with better financial incentives and more security for themselves and their families.