Life Insurance Corporation of India Report on the Audit of the Standalone Financial Statements Opinion
1. We have audited the accompanying Standalone Financial Statements of Life Insurance Corporation of India ("the Corporation"), which comprise of the Standalone Balance Sheet as at March 31, 2026, the Standalone Revenue Account (also called the “Policyholders’ Account” or the “Technical Account”), Standalone Profit and Loss Account (also called the “Shareholders’ Account” or the “Non - Technical Account”) and the Standalone Receipts and Payments Account for the year ended March 31 2026, and a summary of significant accounting policies and other explanatory information, in which are included 8 Zonal Offices, 113 Divisional Offices and 74 units of Pension & Group Schemes audited by the zonal/divisional auditors appointed by the Corporation and the returns of 3 foreign branches (Fiji, Mauritius, United Kingdom) audited by their respective local auditors and for 1 foreign branch (GIFT City, India) audited by one of the Corporation auditors.
2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements are prepared, in accordance with the Life Insurance Corporation Act 1956 ( the “LIC Act”), as amended, the Insurance Act, 1938 (the “Insurance Act”), as amended, Insurance Regulatory and Development Act, 1999 (the “IRDA Act”), Insurance Regulatory and Development Authority of India (Actuarial Finance and Investment Functions of Insurers) Regulation, 2024, including orders/ directions/ circulars issued by the Insurance Regulatory and Development Authority of India (“IRDAI”), including the Accounting Standards specified under section 133 of the Companies Act, 2013, to the extent applicable and in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India, as applicable to insurance companies:
i. in the case of the Balance Sheet, of the state of affairs of the Corporation as at March 31,2026;
ii. in the case of the Revenue Account, of the net surplus for the year ended on that date;
iii. in the case of the Profit and Loss Account, of the profit for the year ended on that date; and
iv. in the case of the Receipts and Payments Account, of the receipts and payments for the year ended on that date.
Basis for Opinion
3. We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing (SA’s) issued by the Institute of Chartered Accountants of India (“ICAI”). Our responsibilities under those standards are further described in the ‘Auditors’ Responsibilities for the Audit of Financial Statements’ section of our report. We are independent of the Corporation in accordance with the Code of Ethics issued by the ICAI together with the ethical requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the LIC Act and the Rules thereunder, as amended and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Emphasis of Matters
4. We draw attention to the following notes to the Standalone Financial Statements under Schedule 16(B):
a) Note No. 29, wherein it is mentioned that pursuant to regulatory approval received by the Corporation, an amount of ' 9,280.37 crores pertaining to additional contribution due to increase in family pension is being amortised over 20 quarters commencing from Q3 of the FY 2023-24 amounting to ' 464.02 crore per quarter. Accordingly, an amount of ' 1,856.08 crores has been charged to Revenue Account during the year ended March 31,2026.The balance amount of ' 4,640.17 crores shall be amortised over the subsequent quarters upto Q2 of the FY 2028-29.
b) Note No. 30, wherein it is mentioned that pursuant to regulatory approval received by the Corporation, an amount of ' 7,230.09 crores in Par segment pertaining to excess Expenses of Management for the FY 2022-23 shall be replenished from Shareholders' account in equal annual instalments not exceeding three, commencing from Q1 of the FY 2024-2025. Accordingly, an amount of ' 2,410.04 crores has been replenished from the Shareholders’ account during the year ended March 31, 2026. The balance amount of ' 2,410.01 crore shall be replenished from Shareholders’ account over the subsequent quarters upto Q4 of the FY 2026-27.
c) Note No. 31, wherein it is mentioned that pursuant to regulatory approval received by the Corporation, an amount of ' 5,477.10 crores towards additional pension liability pertaining to Par segment is being charged to the Shareholders account over a period not exceeding three years commencing from the FY 2024-2025. Accordingly, an amount of ' 1,825.68 crores has been charged to Shareholders’ account during the year ended, March 31, 2026. The balance amount of ' 1,825.74 crores shall be charged to Shareholders’ account over the subsequent quarters upto Q4 of the FY 2026-27.
Our opinion is not modified in respect of these matters.
Key Audit Matters
5. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Standalone Financial Statements of the current year. These matters were addressed in the context of our audit of the Standalone Financial Statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matter below to be the key audit matter to be communicated in our report.
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Key audit matters
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How our audit addressed the key audit matters
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1. Classification and Valuation of Investments
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We have carried out the following audit procedures:
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(31.03.2026: ' 55,45,899.38 crore)
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• Understood the Corporation’s process and procedures
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(Refer Schedule 8, 8A, 8B of the Standalone Financial
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and tested controls to ensure proper classification and
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Statements. Refer schedule 16(A)8 to the Standalone
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valuation/ impairment of investments.
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Financial Statements for accounting policy.)
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• Tested recording of investments on sample basis and
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The Corporation’s investment portfolio is bifurcated into
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verified classification of investments and compliance with
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linked and non-linked. The investment portfolio forms
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Regulations and policies approved by Board of Directors
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significant portion of the total assets of the Corporation.
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of the Corporation.
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As prescribed by Insurance Regulatory and Development
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• Obtained independent balance confirmations for
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Authority of India (the “IRDAI”), all investments should
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investments as at balance sheet date from the custodians
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be in accordance with the Insurance Regulatory and
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and depository participants appointed by the Corporation
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Development Authority of India (Actuarial, Finance and
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to check the units of securities for the purpose of valuation
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Investment Functions of Insurers) Regulations, 2024
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re-computation.
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(the “Regulations”) and policies approved by Board of Directors of the Corporation.
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• On a test check basis, recomputed valuation of different class of investments to assess valuation methodologies
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All investments should be valued as prescribed in the
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with reference to the Regulations along with the
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Regulations which prescribe the valuation methodology to
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Corporation's Board approved policy;
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be adopted for each class of investments.
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• Assessed valuation of securities to examine whether
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The unlisted or other than actively traded investments are
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the same is in accordance with the Regulations and
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measured at historical cost less provision for diminution/
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Corporation’s accounting policies.
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impairment, which involves management judgement and estimate.
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• Tested impairment/provision of securities (including
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reversal), which have been observed and are in
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Further, due to the reassessment of the investee
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accordance with the Regulations and Corporation’s
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Company’s rating, there could be a need for reclassification of investment and consequent impact on its valuation / impairment keeping in view the Regulations and/ or Corporation’s internal policies.
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impairment policies.
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Key audit matters
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How our audit addressed the key audit matters
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Hence, the valuation of investments is considered to be one of the areas which required our significant attention and is one of the key audit matters due to the materiality of total value of investments to the Standalone Financial Statements.
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• In respect of unlisted and other than actively traded investments, we evaluated the Corporation’s valuation methodology and assumptions and corroborated these with Regulations and Corporation’s internal policies including those related to impairment.
• For any changes in ratings of the investee Company, we examined the Corporation’s assessment with the Regulations and Corporation’s internal policies for reclassification and valuation.
• We have perused the available concurrent audit reports on investments.
Based on the work carried out, we did not come across any significant matter which indicates that the investments were not properly classified or valued.
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2. Appropriateness of the Timing of Revenue Recognition
Refer Schedule 1 of Revenue Account of the Standalone Financial Statements.
During the year, the Corporation has recognised net premium income of ' 5,35,984.22 crores.
We have focused on this area because of the significant concentration of revenue during the last quarter of financial year (including cut-off at the Balance sheet date). Due to the nature of the industry, revenue is skewed towards the Balance Sheet date. Hence, there is possibility that policy sales of the next financial year are accounted in the current period.
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The Division/Branch Auditors have carried out the following audit procedures as reported in their Audit Reports shared with us:
• Understood and evaluated the design and operating effectiveness of process and controls relating to recognition of revenue.
• Testing of key controls for ensuring that the revenue has been accrued in the correct accounting period.
• Tested on a sample basis the policies at the year end to confirm if related procedural compliances with regard to acceptability of the terms of policy were completed before the year end to ensure appropriate accounting of revenue.
• Tested on a sample basis unallocated premium / proposal deposit / premium deposit to ensure that there were no policies where risk commenced prior to Balance Sheet but revenue was not recognised.
Based on the work carried out by the Division/Branch Auditors under the Zonal auditors, we did not come across any significant matter which indicates that the revenue recognition is not accounted in the correct period.
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Key audit matters
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How our audit addressed the key audit matters
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3. Contingencies relating to certain matters pertaining to Direct and Indirect Tax
The Corporation has material uncertain tax positions including matters under dispute which involves significant judgment to determine the possible outcome of these disputes. The Corporation has disputes pending at various levels of tax authorities over the past several years.
The management with the help of its expert, as needed, have made estimation with respect to the likelihood of an obligation arising and whether there is a need to recognise a provision or disclose a contingent liability.
We have considered Litigations and claims as Key Audit Matter because the estimates on which these amounts are based involve a significant degree of management judgment, including accounting estimates that involves high estimation uncertainty.
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We have carried out the following audit procedures:
• Understood Management’s internal instructions, process and control for determining and estimating the tax litigations, other litigations and claims and its appropriate accounting and/or disclosure;
• Discussed pending matters with the Corporation’s legal counsel and in-house tax experts;
• Reviewed the management’s underlying assumptions in estimating the tax provision, the possible outcome of the disputes, legal precedence and other rulings in evaluating management’s position on these uncertain tax positions.
• Assessed the management judgements, industry level deliberations and estimates for possible outflow and opinion of internal experts/ External Tax Advisors/ lawyers of the Corporation in relation to such disputed tax positions
Based on the work performed, in view of the contingencies relating to certain matters pertaining to Direct and Indirect Tax, we determined the extent of provisioning and disclosure of contingent liabilities as at March 31,2026 to be reasonable.
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Information Other than the Standalone Financial Statements and Auditors’ Report thereon
6. The Corporation’s Board of Directors is responsible for the other information. The other information comprises the information included in the annual report, but does not include the Standalone Financial Statements and our auditors’ report thereon. The annual report is expected to be made available to us after the date of this auditors’ report.
Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
When we read the annual report, if we conclude that there is a material misstatement therein, we will communicate the matter to those charged with governance and take appropriate action as applicable under the relevant laws and regulations.
Responsibilities of Management and Those Charged with Governance for Standalone Financial Statements
7. The Corporation's Board of Directors is responsible for the preparation and presentation of these Standalone Financial Statements in terms of the requirements of the LIC Act, as amended, so that they give a true and fair view of the of the financial position, financial performance, and receipts and payments of the Corporation, in accordance with accounting principles generally accepted in India including the provisions of the LIC Act, as amended , the Insurance Act, as amended read with the IRDA Act, the Regulations, order/ directions issued by the IRDAI in this regard and in accordance with the accounting principles generally accepted in India, including the accounting standards specified under section 133 of the Companies Act, 2013 to the extent applicable and in the manner so required.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the LIC Act, as amended for safeguarding of the assets of the Corporation and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Standalone Financial Statements, management is responsible for assessing the Corporation’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Corporation or to cease operations, or has no realistic alternative but to do so.
The Corporation's Board of Directors are also responsible for overseeing the Corporation’s financial reporting process.
Auditors’ Responsibilities for the Audit of the Standalone Financial Statements.
8. Our objectives are to obtain reasonable assurance about whether the Standalone Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Financial Statements.
9. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
i. Identify and assess the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.
ii. Obtain an understanding of the internal controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 25B(3)(i) of the LIC Act, we are also responsible for expressing our opinion on whether the Corporation has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
iii. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
iv. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Corporation to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Corporation to cease to Continue as a going concern.
v. Evaluate the overall presentation, structure and content of the Standalone Financial Statements, including the disclosures, and whether the Standalone Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
10. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.
11. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
12. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Other Matters
13. The actuarial valuation of liabilities for life policies in force is the responsibility of the Corporation’s Appointed Actuary (the "Appointed Actuary"). The actuarial valuation of these liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists as at March 31,2026 has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Authority. We have relied upon the Appointed Actuary's certificate in this regard for forming our opinion on the valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists, as contained in the Standalone Financial Statements/ information of the Corporation.
14. The audited financial statements/ information of the 4 foreign branches (United Kingdom, Mauritius, Fiji and GIFT City, India) included in the Standalone Financial Statements reflect total assets of ' 5,976.97 crores as at March 31, 2026, total revenue of ' 697.67 crores , net profit of ' 27.15 crores for the year ended March 31, 2026. Our opinion on the Standalone Financial Statements, in so far as it relates to the amounts and disclosures included in respect of these 3 foreign branches is based on report of such other auditors and for 1 branch audited by one of the Corporation auditors.
15. The financial statements / information of 8 Zonal Offices, which includes 113 Divisional Offices (DO) (including branches there under) and 74 units of Pension & Group Schemes (P&GS) included in the Standalone Financial Statement whose financial statement reflect total assets other than current liabilities of ' 2,16,355.33 crores as at March 31,2026, total premium income of ' 5,19,110.98 crores, for the year ended March 31, 2026, have been audited by the zonal auditors, whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of zones is based solely on the report of such zonal auditors.
16. The Standalone Financial Statement includes comparative figures for the year ended March 31, 2025, which have been audited by an earlier set of two audit firms as joint auditors, who have expressed unmodified opinion vide their report dated May 27, 2025 and one of those two audit firms is a continuing audit firm.
Our opinion is not modified in respect of the above matters.
Report on other legal and regulatory requirements.
17. As required by the Regulations, we have issued a separate certificate dated May 21, 2026 certifying the matters specified in paragraphs 3 and 4 of Schedule II Part III to the Regulations.
18. The Actuarial Valuation of liabilities for life policies in force and policies in respect of which premium has been discontinued but liability exists as at March 31,2026 is the responsibility of the Corporation’s Appointed Actuary (‘the Appointed Actuary’). The Appointed Actuary has duly certified the actuarial valuation of liabilities and the fund for future appropriation for life policies in force and policies in respect of which premium has been discontinued but liability exists as at March 31,2026 and in his opinion the assumptions for such valuation are in accordance with the guidelines and norms issued by the IRDAI and the Institute of Actuaries of India in concurrence with the Insurance Regulatory and Development Authority of India.
19. Further, to our comments in the Certificate referred to in paragraph 17 above, as required under the IRDAI Regulations and
under sub section (3) of Section 25B to the LIC Act (as amended) we report that;
i. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit and have found them to be satisfactory.
ii. In our opinion and to the best of our information and according to the explanations given to us, proper books of account as required by law have been maintained by the Corporation so far as it appears from our examination of those books except for those reported in paragraph 19(xi)(f) of this report;
iii. In our opinion proper returns of zones/ divisional offices and branches have been received and found them adequate for the purpose of audit;
iv. The Balance sheet, Revenue account, Profit and Loss account and the Receipts and Payments Account dealt with by this report are in agreement with the books of account and returns;
v. In our opinion and to the best of our information and according to the explanations given to us, the Investments have been valued in accordance with the provisions of the Insurance Act, Regulations and orders / directions issued by IRDAI in this behalf;
vi. In our opinion and to the best of our information and according to the explanations given to us, the accounting policies adopted by the Corporation are appropriate and are in compliance with the applicable accounting standards specified under section 133 of the Companies Act, 2013, to the extent not inconsistent with the accounting principles prescribed in the IRDAI Regulations and orders/ directions / circulars issued by IRDAI in this regard.
vii. In our opinion and to the best of our information and according to the explanations given to us, the Balance Sheet, the Revenue Account, the Profit and Loss Account and the Receipts and Payments Account dealt with by this report comply with the Accounting Standards referred to in Section 133 of the Companies Act, 2013 to the extent they are not inconsistent with the accounting principles prescribed in the IRDAI Regulations including Master Circulars, orders, directions and other circulars issued by IRDAI in this regard.
viii. On the basis of the written representations received from the directors as at March 31, 2026, taken on record by the Board of Directors, none of the directors are disqualified as at March 31, 2026, from being appointed as a director in terms of Section 4A(i) of the LIC Act..
ix. The modification relating to the maintenance of accounts and other matters connected therewith are stated in paragraph 19(ii) above.
x. With respect to the adequacy of the internal financial controls with reference to financial statements of the Corporation and the operating effectiveness of such controls, refer to our separate report in “Annexure A”.
xi. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 as specified by Rule 23(i) of LIC General Rule 1956 , in our opinion and to the best of our information and according to the explanations given to us:
a) The Corporation has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Schedule 16(B) - note 1 to the Standalone Financial Statements.
b) The Corporation has made provision as at March 31, 2026, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Schedule 16(B) - note 17 to the Standalone Financial Statements.
c) There are no amounts which are required to be transferred to the Investor Education and Protection Fund by the Corporation for the year ended March 31,2026.
d) i. The management has represented that, to the best of its knowledge and belief, no funds have been advanced
or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Corporation to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Corporation ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries to the financial statements);
ii. The management has represented that, to the best of its knowledge and belief, no funds have been received by the Corporation from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Corporation shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
iii. Based on such audit procedures that we considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) above contain any material misstatement.
e) The final dividend, proposed in the previous year, is declared and paid by the Corporation during the year is in accordance with Section 28B of the LIC Act, as applicable. The Board of Directors of the Corporation have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The amount of dividend proposed is in accordance with section 28B of the LIC Act, as applicable (refer Schedule 16(B) - note 33 to the Standalone Financial Statement)
f) Based on our examination which included test checks, the Corporation has used accounting software for maintaining its books of account, which have a feature of recording audit trail (edit log) facility and the same have operated throughout the year for all relevant transactions recorded in the respective software except that:
In case of ePGS, audit transaction log in Database is not enabled due to performance and space constraints. However, data required for audit is maintained in the history table of the respective module. In addition to this the application log, server log, LB logs are also captured to augment the audit data. Transaction level logs of ePGS can be derived from the relevant module tables.
For accounting software other than the aforesaid databases during the course of our audit, we did not come across any instances of audit trail feature being tampered with and the audit trail has been preserved by the Corporation as per the statutory requirements for record retention.
V. Sankar Aiyar & Co. Mukund M Chitale & Co.
Chartered Accountants Chartered Accountants
FRN: 109208W FRN: 106655W
CA G Sankar CA Nisha Yadav
Partner Partner
Membership No.: 046050 Membership No.: 135775
UDIN: 26046050EWYFIO7394 UDIN: 26135775BCOOIP7698
Place: Mumbai Date: May 21st, 2026
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