Top LIC officials said here today that in order to service its over 8.5 crore customers better, they have launched a major computerisation drive with over 95 per cent branches, including rural branches, already boasting of computers for the front office operations.

``Besides, we have provided metro area network and interactive voice response system (IVRS) in the metro cities of Mumbai, Chennai, Bangalore and Delhi to the customers. These services are now being extended to Calcutta, Pune, Hyderabad and Ahmedabad shortly,'' said LIC executive director H H Faruqi. Networking of branches will enable a policy holder in thesecities to pay his premium at any of the city branch whereas IVRS enables the policy holder to get information about his policy directly over the telephone or fax.

The corporation has also included a retired judge in each of the zonal claims review committee to provide more transparency. This is excluding a retired judge in its central claims review committee. LIC has now gone step further and set up a consumer affairs committee to advice it on matters of consumer interest.

LIC officials say that the corporation has settled 56.52 lakh claims amounting to Rs 6,677 crore during 1997-98. In fact, on an average LIC settled over 19,423 claims amounting to Rs 23 crore every working day, in the previous fiscal. During the current fiscal upto February-end, LIC has settled 41.36 lakh claims for Rs 6,043 crore.

On lapsed policies, LIC officials say that they have never denied payment of unclaimed amount to its policyholders even if they come years after the date of maturity. Nor does it plead the law of limitationin such cases. ``In fact, LIC is the only financial institution, which follows up very vigorously with its customers for paying their claims. Our offices issue maturity intimations two months prior to the date of maturity and in as many as 73 per cent of cases, the maturity claims are settled on or before the date of maturity through post-dated cheques,'' Faruqi said.

The expenses incurred for procurement of new business are often more than the first year's premium. Hence the question of LIC accumulating huge funds under lapsed policies does not arise, LIC officials add.

As far as forefeiture of premiums are concerned, the first year expenses like cost of underwriting of lives, issuance of the policies, policy stamps, publicity expenses etc are quite high. Therefore, surrender value/paid-up value are allowed only if the premiums are paid for at least a minimum of three years. It is a worldwide practice among the insurance companies to provide for forefeiture of premiums paid for less than three years, LICofficials clarified.