India to Introduce Insurance Amendment Bill During Monsoon Session
The Indian government is poised to introduce the Insurance Amendment Bill in Parliament during the upcoming monsoon session, according to sources cited by Indian news sites. The bill, which has been finalized, is expected to be presented to the Cabinet for approval shortly before being tabled in Parliament.
The proposed legislation aims to increase the foreign direct investment (FDI) ceiling in insurance companies from the current 74% to 100%. This move is part of broader financial sector reforms announced by Finance Minister Nirmala Sitharaman in the current year’s Budget.
Key Provisions of the Insurance Amendment Bill:
- Raising the FDI limit in the insurance sector to 100%
- Lowering paid-up capital requirements for insurance companies
- Introducing provisions for a composite license
- Allowing insurance agents to sell products from multiple insurers, moving away from the current exclusivity model
The bill also proposes amendments to the Life Insurance Corporation Act, 1956, and the Insurance Regulatory and Development Authority Act, 1999, in addition to changes to the Insurance Act, 1938. Currently, India has 25 life insurance companies and 34 non-life or general insurance firms operating in the market.
The monsoon session of Parliament typically begins in July, and the government is working to meet this timeline for introducing the legislation.
This development is part of a larger effort to reform the financial sector in India, with significant implications for the insurance industry and foreign investment in the country.
