The Indian government is likely to introduce a bill in the upcoming winter session of Parliament to raise the foreign direct investment (FDI) limit in the insurance sector from the current 74% to 100%. According to senior officials, the Department of Financial Services has been working closely with other ministries to finalise the draft legislation aimed at liberalising the capital structure of insurance companies.
This proposal is seen as part of broader reforms to enhance the depth of the Indian insurance market, attract global capital, and improve insurance penetration across the country. Sources say that while the plan was initially shelved due to political and sectoral concerns, renewed interest from global players and the need to boost long-term capital availability has brought it back into focus.
If cleared, the move will allow full foreign ownership of Indian insurance companies, significantly altering the competitive and investment landscape. Industry stakeholders are watching closely, given its wide-ranging implications for governance, operations, and regulatory oversight.
