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In insurance, uberrima fides—utmost good faith—is not a courtesy. It’s a covenant. It demands complete honesty from both parties. But LIC, India’s largest insurer, has made a habit of breaching this sacred trust. Today, behind the veil of legacy and patriotism, it sits smugly atop a mountain of sins—built on delayed payouts, repudiated claims, lapsed policies, and unclaimed funds.
Breach of Uberrima Fides—Again and Again
LIC enforces disclosure with a steel fist. A forgotten ailment, a misspelled name—grounds for claim denial. Yet, when the time comes to deliver, it vanishes behind forms, files, and footnotes. The duty of good faith has become one-sided. What was once a safety net is now a legal trap.
Families in grief are met not with empathy, but with technicalities. Bureaucracy doesn’t just delay—it defeats. And LIC profits from that defeat.
Outdated Systems, Deliberate Indifference
India has reached Mars. LIC still demands notarised documents, multiple visits, and handwritten forms. Claims can’t be filed end-to-end online. Branch staff often contradict each other. Systems crash. Phones ring endlessly.
This is not incompetence. It is design. An architecture meant to wear you down. Delay long enough, and people give up. The savings remain—quietly—in LIC’s vaults.
Delay, Deny, Deflect
Even routine death claims are “investigated.” LIC uses the full 120-day window allowed by regulation, often without cause. Interest for delays? Payable, but rarely paid unless pressed. The onus is on the widow or the child to chase a faceless office.
When courts intervene, LIC quietly settles. But its conduct doesn’t change. The goal is clear: protect the corpus, not the claimant.
19th-Century Premiums, 21st-Century Disappointments
LIC continues to push outdated endowment and ULIP policies. Projected returns look generous. Real internal returns often fall below 5%. Meanwhile, surrender penalties are steep. Agents thrive. LIC grows. The policyholder, once again, is left with less than imagined.
These aren’t investments. They are long-term traps, disguised as guarantees.
Thousands of Crores in Repudiated Claims
A 98% claim settlement ratio sounds impressive. But that 1–2% still means thousands of crores rejected each year. Many are denied on flimsy pretexts—non-disclosure, lifestyle omissions, or old habits never declared.
LIC knows most people won’t fight back. They lack the time, resources, or legal knowledge. Those who do often win in forums and courts. But justice delayed is still justice denied.
₹20,000 Crore Everest of Unclaimed Funds
LIC sits on more than ₹20,000 crore in unclaimed amounts—matured policies, survival benefits, death claims. Most of it belongs to poor or rural families, unaware or unable to navigate the process. LIC’s tracing efforts are minimal. Its search portals are poor. Communication is worse.
There is no urgency to return this money. It earns on this float. The longer it lies unclaimed, the better it is—for LIC.
LIC’s Mounting Moral Debt
- Thousands of crores locked in denied and unclaimed claims
- Outdated systems designed for attrition, not access
- Products that overpromise and underdeliver
- A culture of opacity and avoidance
This isn’t accident. It’s a system calibrated to hoard. A legacy institution that once promised security now profits from silence, delay, and despair.
The Final Insult: A Motto Turned Mockery
LIC’s fortress is built on broken promises. Yet it still flaunts its Sanskrit motto: Yogakshemam Vahamyaham—“Your welfare is our responsibility.” Taken from the Bhagavad Gita, it once stood for moral duty. Today, it rings hollow. In practice, LIC seems to mean: “Your welfare is our windfall.”
Yes, LIC is still India’s most trusted insurer. But trust isn’t a relic. It must be renewed—claim by claim, conduct by conduct.
It’s time for LIC to stop hiding behind nostalgia and numbers. It must pay interest when it delays. Stop weaponising technicalities. End petty repudiations. And finally, honour the principle it once stood for.
Because every rupee withheld is a breach of faith.
Every delay is a betrayal.
This isn’t financial caution—it is moral collapse.
LIC isn’t just hoarding money. It’s betraying the very creed it was built upon.
These pieces are being published as they have been received – they have not been edited/fact-checked by ThePrint.