Parliament passes bill to raise FDI in insurance sector to 100%

The Rajya Sabha on Wednesday passed a bill to raise foreign direct investment in the insurance sector to 100% from 74%.

The 2025 Sabka Bima Sabki Raksha Amendment of Insurance Laws Bill was passed in the Lok Sabha on Tuesday. The bill seeks to amend the 1938 Insurance Act, the 1956 Life Insurance Corporation Act and the 1999 Insurance Regulatory and Development Authority Act.

It allows the merger of non-insurance companies with insurance firms, and provides for the establishment of a Policyholders’ Education and Protection Fund to protect the interests of policyholders.

Union Finance Minister Nirmala Sitharaman, during a debate on the bill, said that the amendments would allow foreign companies to bring in more capital in the insurance sector, PTI reported.

The opening of the sector has helped in increasing penetration of insurance in the country, Sitharaman said, adding that there was “scope for more”. It would also lead to the creation of more jobs, she added.

The Bharatiya Janata Party leader said that the increase in the foreign direct investment limit would pave the way for more foreign companies to enter the Indian market, the news agency reported. In many cases, foreign firms do not find local joint venture partners because of several reasons, she added.

With more companies, the competition will increase,...

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