EARNINGS

LIC provides lucrative remuneration to its agents, as agents are the backbone of LIC and helped LIC to grow immensely over the years. 

Basic structure:

First year commission - upto 35% of 1st year Premium

Renewal commission- upto 7.5% (2nd year and 3rd year)

Renewal commission -  upto 5% of 4th year onwards

For single premium policies - upto 2%

For example:

Agent sells a policy to a customer  ( premium -Rs 50,000/- annnually, premium paying term- 20 years), then the agent will get

1st year- 35% of 50000 = 17500/-

2nd year- 7.5% of 50000 = 3750/-

3rd year- 7.5% of 50000 =  3750/-

(4th year to 20th year)- 5% of 50000 = 2500/-  (for next 17 years i.e., 4th year to 20th year)

Total commission = {17500 + 3750+ 3750 + (2500 x 17)} = Rs 67500/-