INDUSTRY
Bill to hike FDI limit in insurance sector to 100% gets Union Cabinet’s green light
- IBJ Bureau
- Dec 13, 2025
The Union Cabinet has approved a bill to raise foreign direct investment (FDI) in the insurance sector to 100 per cent.
The bill may be introduced in the on-going winter session of the Parliament, which is slated to conclude on December 19.
According to a Lok Sabha bulletin, the Insurance Laws (Amendment) Bill, 2025, which seeks to deepen penetration, accelerate growth and development of the insurance sector and enhance ease of doing business, is a part of the 13 legislations listed for the on-going session of Parliament.
In this year’s Union Budget speech, Finance Minister Nirmala Sitharaman had proposed to raise the foreign investment limit to 100 per cent from the existing 74 per cent in the insurance sector as a part of new-generation financial sector reforms.
So far, the insurance sector has attracted Rs 82,000 crore through FDI.
The Finance Ministry has proposed to amend various provisions of the Insurance Act, 1938, including raising FDI in the insurance sector to 100 per cent, reducing paid-up capital for insurance companies and introducing a composite licence.
As a part of a comprehensive legislative exercise, the Life Insurance Corporation Act, 1956, and the Insurance Regulatory and Development Authority Act, 1999, will be amended, alongside the Insurance Act, 1938.
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