Jeevan Bima Nigam Files Drhp; 25% Of Aum In Equities; Check Out Key Risks And Other Important Dates

LIC IPO DRHP | Key risks to know 

Here are some of the key risks highlighted by the state-run insurance major in its draft red herring prospectus (DRHP):

–Pandemic could adversely affect all aspects of LIC’s business, including agents’ ability to sell products, investment portfolio, operational effectiveness

–Any unfavourable publicity could have adverse effect on brand name, consequently adversely affect business

–Any adverse persistency metrics or adverse variation in persistency metrics could have a material adverse effect

–Segregation of LIC’s Life Fund into two separate funds — a participating policyholders’ fund and a non-participating policyholders’ fund — (effective September 30, 2021) may adversely affect business

–A mismatch in actual claims experienced, other parameters from assumptions used in product pricing could have a material adverse effect

–Interest rate fluctuations may affect profitability

–A significant proportion of LIC’s total new business premiums are generated by participating products and single premium products; any regulatory changes or market developments that adversely affect sales of such products adversely effecting business

–Company’s risk management policies, procedures, internal controls, risk management tools may not be adequate or effective (Check out the complete list of risks involved in LIC’s IPO)