Higher premium income and investment gains boosted the public sector life insurer LIC's net income manifold to Rs 6,334.2 crore during the three months ending December 2022 as against Rs 235 crore a year ago.

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The Life Insurance Corporation (LIC) on Thursday said it has earned Rs 1,11,787.6 crore in net premium income during the reporting quarter as against Rs 97,620.34 crore in the year-ago period.

Of the total premium income, first-year premium rose to Rs 9,724.7 crore in the reporting quarter up from Rs 8,748.5 crore a year ago. The renewal premium income rose to Rs 60,194.87 crore, up from Rs 56,822.5 crore, and the single premium income jumped to Rs 42,117 crore, up from Rs 32,190 crore a year ago.

Of the total net income, as much Rs 5,670 crore is accretion from the non-par fund, which is due to the change in the accounting norms and the enabling provision to transfer surpluses from this account to shareholder, LIC chairman M R Kumar told reporters at the post-earnings conference call.

This provision also made the company to budget Rs 2,000 crore for transferring Rs 19,000 crore to the shareholders fund, including which the net income would have been Rs 8,334.2 crore, Kumar said.

LIC's income from investments rose to Rs 84,889 crore from Rs 76,574.24 crore a year ago, the company said in a regulatory filing.

Its investments into the crisis-ridden Adani Group has been under tremendous criticism even though the value of the investment of close to Rs 36,000 crore are still in the green despite those shares losing almost 60 per cent of their value since January 25.

However, the numbers are strictly not comparable as the insurer was not a publicly traded company earlier. It went public in May 2022 after a Rs 20,535-crore initial share sale.

LIC's agency commission jumped massively to Rs 8,319 crore paid to its over a million agents, compared to Rs 5,850.7 crore in December 2021 quarter, but management expenses came down marginally to Rs 13,799 crore from Rs 14,022 crore.

On the new budget provision to tax life insurance policies with annual premium of more than Rs 5 lakh, the company said the provision will have negligible impact on its sales as such portfolio is only 1.85 per cent of the total annualised premium.

But Kumar added, "We have to get clarity form the ministry on the methodology on how this will be calculated... Only for single premium or on the total investment that one person may have with many insurers. But let me add that we are no longer selling life insurance as a tax saving tool but as purely life insurance only. We have 20 crore customers/policyholders while there are only 6 crore taxpayers."

On the sale of its banking arm IDBI Bank, he said he has not heard anything more from the government apart from what is in public domain, including clarity on how much of its holding will finally be sold.

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LIC has budgeted for transferring Rs 6,099 crore to the shareholders fund during the reporting quarter as against Rs 117.8 crore in the year-ago period, which was not paid out as then it did not have such a provision.

Had this not been budgeted, the net income of LIC would have been Rs 8,334.2 crore as against Rs 235 crore a year ago, the chairman said, adding the bottom-line was also impacted by the surplus transfer to the shareholders fund from non-participating products fund worth Rs 19,941.56 crore so far this fiscal.

Clarifying the transfer, the chairman said, "The Corporation has changed its accounting policy during the current year and accordingly has transferred an amount of Rs 19,941.56 crore (net of tax) pertaining to the accretion on the available solvency margin from non-par policies to Shareholders.

"Accordingly, the account due to which profit for the nine months period ended December 2022 has increased to the same extent or by Rs 5,669.79 crore net of taxes for the reporting quarter and by Rs 5,580.72 crore net of taxes for the quarter ending September 2022, Rs 4,148.77 crore net of taxes for the June 2002 quarter and Rs 4,542.31 crore net of taxes for the March 2002 quarter," he said.

During the nine months period of this fiscal, the company made an additional provision of Rs 11,543.75 crore for employee retirement benefits due to wage revision which became effective from August 2022.

Other income includes interest amounting to Rs 6,626.98 crore towards refund of income tax for the earlier financial years.

LIC has outstanding unclaimed amounts/deposits and interest accrued on unclaimed amounts aggregating to Rs 20,724.58 crore at end December 2022.

The LIC counter edged up 53 basis points to close at Rs 613.35, having lost more than a third of its listing price value since May last.