The article discusses the breach of trust by the Life Insurance Corporation of India (LIC), the country’s largest insurer, with its customers. The concept of “uberrima fides” or utmost good faith is a fundamental principle in insurance, which demands complete honesty from both parties. However, LIC has consistently violated this principle by delaying payouts, repudiating claims, and hiding behind technicalities.
The article highlights several issues with LIC’s practices, including outdated systems, deliberate indifference, and a culture of opacity and avoidance. For instance, LIC still demands notarized documents, multiple visits, and handwritten forms, making it difficult for customers to file claims. The company’s systems are designed to wear down customers, leading to delays and eventual abandonment of claims.
Moreover, LIC’s claim settlement ratio of 98% may seem impressive, but it still means that thousands of crores are rejected each year on flimsy pretexts. The company knows that most people will not fight back due to lack of time, resources, or legal knowledge. Those who do fight back often win in forums and courts, but justice is delayed, and sometimes denied.
The article also notes that LIC sits on more than ₹20,000 crore in unclaimed amounts, mostly belonging to poor or rural families who are unaware or unable to navigate the process. The company’s tracing efforts are minimal, and it earns interest on this float, making it better for LIC if the money remains unclaimed.
The author argues that LIC’s practices are not accidental but rather a system calibrated to hoard. The company’s motto, “Yogakshemam Vahamyaham” or “Your welfare is our responsibility,” has become a mockery, as it prioritizes profits over people. The article concludes that it is time for LIC to stop hiding behind nostalgia and numbers and to honor the principle of utmost good faith.
The author demands that LIC pay interest when it delays, stop weaponizing technicalities, end petty repudiations, and finally honor its commitments. Every rupee withheld is a breach of faith, and every delay is a betrayal. The article suggests that LIC’s practices are not just financially cautious but also morally collapsed, betraying the very creed it was built upon. Overall, the article is a scathing critique of LIC’s practices and a call to action for the company to reform and prioritize its customers’ welfare.