Mumbai: Public sector insurer and the country''''s largest life insurance company, Life Insurance Corporation of India (LIC), will sponsor the country''''s first pension fund company.
LIC has formed a separate company - LIC Pension Fund Ltd - under the Companies Act for its pension fund foray.
LIC was selected by the Pension Fund Regulatory Development Authority (PFRDA) to sponsor a company to manage the pension funds of the central government employees who joined service on or after 1 January 2004, LIC said in a release.
This is also the first company incorporated in India to manage pension funds under the New Pension System (NPS).
One of the conditions for selection was that LIC had to form a separate company to manage these funds. The PFRDA had also selected State Bank of India and UTI Company to be the sponsors of pension funds under NPS.
The government had switched over to the contributory pension scheme or NPS for fresh recruits after January 1, 2004.
Meanwhile, the parliament is planning legislation that will permit foreign firms to own a maximum 26 per cent in a pension fund management company.