Job & Education

How is the job of LIC AAO

We will try and cover different aspects of a LIC AAO’s life from salary, career growth to the job profile, role and responsibilities.

Let’s start with the Job Profile:

An Assistant Administrative Officer more popularly known as an AAO in the Life Insurance Corporation of India (LIC) is an administrative role however the responsibilities vary based on the department in which a LIC AAO works.

The various departments that a LIC AAO can work for are as follows:

  • Finance or Accounts
  • Information Technology (IT)
  • Claims
  • Actuarial
  • New Business
  • Sales and Marketing
  • Inspection
  • Policy Servicing
  • Legal
  • Systems

A LIC AAO’s job is easily one of the best entry-level jobs for any graduate in the Insurance sector or the public sector. An LIC AAO will also typically have to relocate very often for training and posting. You will get to experience different cultures, experience new things, meet new people and explore new places.

Probation period: From the date of joining, an LIC AAO is under probation for a year and it could extend up to 2 years based on performance and other factors.

Note: It is mandatory for a candidate who starts his/her career in LIC as an AAO to remain in the organization for a period of 4 years including the probation period. Typically, for at least 3 years after being recruited, LIC AAOs are deployed outside their natives and there is a high probability that they will be posted in a rural area during this period since a majority of LIC’s branches are located in such areas.

Let’s now take a deeper look at the role and responsibilities.

An LIC AAO’s job is a desk job so it predominantly involves a lot of administrative work.

The primary responsibilities of an LIC AAO are as follows:

  • An LIC AAO is responsible for conceptualizing and planning new schemes and policies that can be offered to clients and potential clients. LIC AAOs are also responsible for fine-tuning or overseeing existing policies and schemes.
  • An LIC AAO is responsible for processing applications for policies from potential policyholders. LIC AAOs are also responsible for processing the claims that are filed since that is also equally important. LIC AAOs are also responsible for supervising settlements to the clients/customers.
  • An LIC AAO assists the AO (Administrative Officers) who heads the department. The AAO supervises the overall functioning of their respective departments and helps the AO/department heads with their day to days. From time to time, LIC AAOs are also assigned tasks by their reporting managers/officers in charge. They will also have to accomplish them on time regularly.
  • AAOs in the LIC are responsible for and help in creating and maintaining databases. The database(s) is/are very crucial to the functioning of the company.
  • An important and integral part of LIC AAO’s job is to interact with vendors, customers, personnel from the sales team, and other colleagues. The interactions with clients could be for upselling, resolving queries/concerns, coming up solutions to clients’ problems, etc.
  • The role of an LIC AAO is cross functional. They liaise with other departments and render assistance whenever necessary to help streamline operations and coordinate with other teams/depts. to run things seamlessly.
  • Negotiation is also another vital aspect of communication and interaction which is a crucial part of the LIC AAO’s role. They are responsible for negotiating with clients, vendors, agents and development officers.
  • Very rarely, LIC AAOs also have to work on underwriting tasks/jobs.
  • LIC AAOs are also responsible for verifying or auditing facts and identifying factual errors or blindspots.

LIC AAO Salary and benefits:

The monthly gross salary is between INR 57,000 and INR 60,000 based on the city/region the AAO is working in.

An LIC AAO’s pay scale in Indian Rupees is as follows: (based on the 7th pay commission)


Breakdown of Pay Scale:

INR 32795 is the basic pay at the very beginning of an LIC AAO’s career and he/she is also entitled to an annual increment of INR 1610 for the next 14 years of service which means the basic pay amounts to INR 55335 at the end of 14 years After 14 years, the annual increment for the next 4 years of service is INR 1,745. The basic pay amounts to INR 62,315 at the end of 18 years and remains the same till superannuation.

Let’s also acknowledge the fact that the salary and associated perks might increase significantly for all LIC employees since the LIC IPO is set to be completed in the upcoming financial year. If things go well then there is at least a bonus coming the way of LIC employees in the foreseeable future.


DA (Dearness Allowance) – Approximately 40% of the basic pay

CCA (City Compensatory Allowance) and HRA (House Rent Allowance) are location-dependent. Based on whether the LIC AAO is working in a class X/Y/Z city or region the CCA can be 0%, 3%, and 4%. HRA can be 7%, 8%, or 9% based on the region/location of employment.

Other Benefits:

  • Loan for 2 wheelers and 4 wheelers (vehicles)
  • Gratuity
  • Group insurance, group personal accident insurance, and group mediclaim
  • Leave Travel Concession (LTC)
  • Cash medical benefits
  • Meal coupons
  • Contributory pension
  • Reimbursements for briefcases, mobiles, and mobile recharges, leather bags, daily newspapers, magazines, coffee/tea, etc.

Career Growth and Prospects:

There are plenty of opportunities to grow within the organization with internal dept. Specific exams held for promotion. Also, with enough experience and years under his/her belt, an LIC AAO can go on to become a Senior Divisional Manager (SDM) or a Zonal Manager (ZM), and so on. With every promotion, the salary, associate benefits, and allowances go up exponentially.

We hope that this gave you insights into the life of an LIC AAO. If you are planning on attempting the LIC AAO recruitment then do check out Testbook’s website and YouTube channel. We offer video lessons, free practise tests, study material, preparation strategies and everything else that you need to crack the LIC AAO selection process effortlessly.

Good luck!

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