The government has extended the superannuation age of IPO-bound LIC Chairman to up to 62 years by making amendment to the Life Insurance Corporation of India (Staff) Regulations, 1960.
The changes made in the rules will be called the Life Insurance Corporation of India (Staff) Amendment Rules, 2021, according to a government notification dated June 30, 2021.
It is to be noted that the retirement age for the top executives of the majority of PSUs is 60 years, barring a few exceptions, including the State Bank of India (SBI).
"Notwithstanding anything contained in these rules, if the Central Government appoints the Chairman for a term of office that extends beyond sixty years of age, or extends his term of office to a period beyond the said age, he shall not superannuate till he completes such term, or till he attains the age of sixty-two years, whichever is earlier," the gazette notification said.
Last month, the government approved a nine-month extension to LIC Chairman M R Kumar till March next year in view of the insurer's proposed initial public offer towards the end of the current fiscal.
In her Budget speech this year, Finance Minister Nirmala Sitharaman had said the Initial Public Offer (IPO) of LIC would be floated in 2021-22 as part of the ambitious Rs 1.75 lakh crore disinvestment target.
The government extended the term of Kumar from June 30, 2021, till March 13, 2022, the date when he completes three years.
The government has already amended the Life Insurance Corporation Act, 1956 along with the Finance Act 2021 to facilitate the public offer. As a part of the amendment, the government significantly increased the authorised capital of LIC to Rs 25,000 crore from Rs 100 crore to facilitate the listing.
The authorised share capital of LIC shall be Rs 25,000 crore divided into 2,500 crore shares of Rs 10 each, as per the amendments in the Life Insurance Corporation Act, 1956.
The government owns a 100 per cent stake in LIC. Once listed, it is likely to become the country's biggest company by market capitalisation with an estimated valuation of Rs 8-10 lakh crore.
The country's largest life insurer has an asset base of Rs 31,96,214.81 crore.
LIC collected the highest ever new business premium of Rs 1.84 lakh crore in the fiscal ended March 31, 2021, as per provisional data.
The market share of the insurer, which has more than 29 crore policyholders, stood at 81.04 per cent in terms of the number of policies issued in March 2021.