India's Insurance Sector Revamp: A New Era with 100% FDI

The Insurance Amendment Bill, set to be introduced in Parliament's monsoon session, proposes raising the foreign direct investment limit in the insurance sector to 100%. It aims to boost policyholder interests, market entry, and employment, while enabling companies to sell multiple insurers' products, enhancing efficiency and insurance penetration.

The proposed Insurance Amendment Bill is poised to revolutionize India's insurance landscape by allowing 100% foreign direct investment (FDI) in the sector. Sources indicate the bill may be introduced in the upcoming Parliament monsoon session.

The draft, awaiting Cabinet approval, is part of a broader financial reform initiative announced by Finance Minister Nirmala Sitharaman. The bill suggests amendments to the Insurance Act, 1938, including FDI cap hikes, reduced paid-up capital, and composite licensing.

Additional proposed changes include multi-insurer product sales by agents, boosting market competition and job creation, with a goal of 'Insurance for All by 2047'. The LIC Act 1956 and Insurance Regulatory and Development Authority Act, 1999 will also see amendments to enhance sector efficiencies.

(With inputs from agencies.)