LIC Net Profit Q4: LIC Q4 results: Net profit jumps 38% on better margins, non-par biz

Mumbai: Life Insurance Corporation of India, the country’s second-largest government asset by market capitalisation, on Tuesday reported a 38% increase in March quarter net profit at ₹19,013 crore due to increase in non-participating products and improvement in margins.

During the corresponding period of the previous financial year, LIC reported a profit of ₹13,762 crore. The board of LIC, among the biggest domestic institutional investors in traded securities, has recommended a final dividend of ₹12 per share for FY25. Despite analyst expectations of a profit dip, LIC reported higher earnings as wage costs eased, since provisions for the wage revision were made last year, bringing the expense ratio down 315 bps to 12.42% in FY25 from 15.57% in FY24.

“After registering a very strong performance in the first six months, we had to redesign and relaunch products to comply with regulatory changes,” said Siddhartha Mohanty, MD and CEO, LIC. This was the last quarterly result under the outgoing MD and CEO.

A change in product regulations during the third quarter and its spillover effects in the fourth quarter led to a slowdown in total annualised premium equivalent to ₹56,828 crore in FY 25 as agents adjusted to the new norms.

For the year ended March 31, 2025, individual annualised premium equivalent (APE) declined by 0.56% to ₹38,218 crore from ₹38,433 crore. Within the Individual Business, participating products contributed 72.3%, while non-par products accounted for 27.69%.

“The third quarter for us was very challenging and we could not fare well and somehow spilled to Q4,” the management said in a post earnings call. “Though towards the end of Q4 March, we did exceedingly well. Whatever negative variation was there in Q3, that was drastically reduced in Q4. Because our agents had to adjust to new product regulations.”The insurance regulator implemented changes to surrender rules effective October 1, 2024. As a result, insurers had to refile select products to incorporate the revised guidelines.”After the new product regulations was introduced, effective October 1, 2024, we have done major revamp in our products and the ticket size, premium size has changed. There is a huge focus on improvement in persistency,” the management said.

The value of new business (VNB) rose 4.47% to ₹10,011 crore in FY25, up from ₹9,583 crore in FY24. The net VNB margin improved by 80 basis points to 17.6% from 16.8% a year earlier.

For the year ended March 31, 2025, LIC held a market share of 37.46% in the Individual segment and 71.19% in the group business. Mohanty said market share is not the company’s primary goal. “Our focus is on profitable growth, which we are demonstrating post listing year after year,” he said.

The solvency ratio as on March 31, 2025, increased to 2.11 against 1.98 a year ago. The insurer saw AUM rise to ₹54.52 lakh crore from ₹51.21 lakh crore.