The Life Insurance Corporation (LIC) invested more than Rs 3,600 crore last year in the tobacco industry, anti-tobacco activists and cancer specialists said today, describing the investments as ironical and unethical.
Figures obtained through the right to information route by a consortium of activists and doctors show that in 2010-11, LIC had invested in shares of ITC and VST Industries and in debentures of Dharampal Satyapal Ltd, which makes chewable tobacco products.
The LIC investment in ITC had a book value of more than Rs 3,561 crore, while its investment in VST Industries was about Rs 15 lakh, according to information released by the company. It also invested Rs 50 crore in Dharampal Satyapal.
“It’s ironic that LIC is investing in an industry that contributes to ill-health and death, and an industry that some arms of the government are trying to discourage,” said Pankaj Chaturvedi, associate professor at the Tata Memorial Hospital, Mumbai.
“The public should know where LIC is investing its funds,” Chaturvedi told The Telegraph. “The government has enforced the ban on public smoking and it has also outlined steps to phase out tobacco cultivation in the coming years.”
The RTI application had been filed by a consortium called Voice of Tobacco Victims, mainly representing patients with cancer. LIC officials were not immediately available to explain its policy of investing in the tobacco industry.
The number of shares held by LIC in ITC jumped from about 522,089,903 on March 31, 2010, to 995,891,658 on March 31, 2011, according to the company’s response to the RTI query.
Tata Memorial doctors said the RTI response from LIC suggested it was not charging extra premium on all tobacco users. “It is ridiculous.… LIC invests in tobacco, it doesn’t charge higher premium from addicts, but they may reject the claims of addicts,” Surendra Shastri, head of preventive oncology at Tata Memorial, said in a statement.
In response to the RTI query on LIC’s policy on insurance for tobacco users, the company said the risk assessment for consumption of tobacco would take into consideration multiple health factors ranging from quantity and type of tobacco to health conditions of the applicant.
“The adverse health effects of tobacco consumption is dependent on (the) quantity of consumption, type of tobacco consumed, duration of consumption and any other associated health condition of the insurance applicant,” LIC said. “Depending on these factors, while large numbers of customers are accepted without any extra premium, some of the applicants may be charged higher premium.”
Public health specialists campaigning against tobacco said the investment was unethical because it was against the principle that governments should not invest in tobacco, enshrined in an international convention to which India is a signatory.
“On the one hand, India incurs a cost of nearly Rs 10,000 crore each year from tobacco-related health expenses, on the other, LIC invests Rs 3,600 crore in tobacco,” Prakash Gupta, director of the Sekhsaria Institute of Public Health, Mumbai, said in a statement.
