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The LIC Group Insurance Scheme for BSNL employees was started in August 2005. It is the biggest Group Insurance Scheme in the world. The Scheme has benefited the BSNL employees as also the LIC, since its market share has increased due to this scheme. The scheme was brought in to operation after detailed discussion between LIC, BSNL and BSNL Employees Union. All India Insurance Employees Association(AIIEA) also helped in clinching the agreement. The double accident benefit with 7.5% extra premium etc. were specially added.

The scheme in 2005 includes three level Insurance, the non-executives for one lakh, the lower executives for Rs.3 lakh and the next higher level for Rs. 5 lakh. Ten years are over now and after the wage revision w.e.f. 2007, the wages have increased and the present wages are substantially higher. In such a case, there is full justification for increasing the insurance amount and the premium accordingly. This was taken up earlier, but the LIC had its reservation due to the high risk and increased % of death rate in BSNL. However, that can not be a reason not to increase the insurance amount.

At least the insurance amount should be increased from Rs. 0ne lakh, three lakh and five lakh to Rs. 3 lakh, 5 lakh and 7 lakh respectively, if not more. The premium also can be raised accordingly.

In this connection, it is also to be noted that the single largest leave encashment scheme of LIC with  2,81,000 BSNL employees were implemented in 2010. BSNL  has  transferred  the Liability of Leave encashment of Rs 4,852.91 crore to LIC under LIC’s Group Leave Encashment Cash Accumulation Scheme (GLES). 

BSNL is the biggest customer of LIC. Hence LIC should not shrink away from increasing the insurance amount for the BSNL employees. The issue need to be taken with the  BSNL Management for re-negotiating with the LIC.