FM Sitharaman says the insurance amendment bill may be submitted in the winter session

Finance Minister Nermalla Sitramman indicated that the draft insurance amendment law, which suggests allowing 100 percent of foreign direct investment (FDI) in the insurance sector in India, can be presented at the winter session of Parliament. The session usually begins in the last half of November and concludes before Christmas.

In response to a question about the introduction to the draft law, Ceramman said, “I hope.” The proposal, which was announced for the first time during the budget speech this year, seeks to reform the policies of the financial sector and align with the goals to increase the opening of the insurance industry and expand capital flows.

Planned changes include increasing the maximum extent based on the current foreign direct investment in the insurance sector from 74 percent to 100 percent for companies that invest the entire installment in India. The Minister of Finance indicated that the handrails and organizational conditions in such foreign investments will be reviewed and simplified.

Since the foreign capital insurance sector has opened, it has attracted 82,000 rupees in foreign direct investment. The government expects these measures to enhance sectoral efficiency, simplify work procedures, and contribute to the goal of achieving “insurance for all by 2047”.

The insurance amendment bill proposes amendments to the various provisions of the insurance law, 1938, including raising the limits of foreign direct investment, reducing paid capital requirements, and providing a complex permit.

In addition, amendments to the Life Insurance Corporation, 1956, and the Law of the Regulation and Development in the field of insurance, 1999. For the Life Insurance Company (LIC), the new provisions enable the Board of Directors to take operational decisions such as opening branches and employment, which reflects a broader batch of operational independence.

These reforms aim to protect the interests of document holders, enhance financial security, and encourage more companies to participate in the insurance market. The current numbers show 25 life insurance companies, 34 non -life insurance companies operating in India, including specialized entities such as the Agriculture Insurance Company in India Ltd. and ECGC LTD.

The insurance sector in India has witnessed a fixed increase in the minimum foreign direct investment in recent years, as it increased from 26 percent to 49 percent in 2015, then to 74 percent in 2021. The insurance law, 1938 is still the main legislation of the sector, ruling relations between insurance companies, documentation campaign, and the Insurance and Development of India (IRDAI). The proposed amendments are a continuation of the government’s strategy to modernize and liberalize the industry.