Insurance
The government may introduce the Insurance Amendment Bill in the upcoming monsoon session of Parliament. It proposes 100 % FDI in the insurance sector. Sources said that the draft of the bill is ready and it will be placed in front of the cabinet soon for approval. He said that after the approval of the cabinet, the Financial Services Department will start the process of introducing the Bill in Parliament under the Ministry of Finance. Sources said that the ministry hopes that the bill will be introduced in Parliament during the upcoming monsoon session.
Announcement was made in budget speech
The monsoon session of Parliament usually begins in July. In this year’s budget speech, Finance Minister Nirmala Sitharaman proposed to increase the limit of foreign investment in the insurance sector from the current 74 percent to 100 percent. He said that this increased limit will be for companies that invest full premium in India. The Finance Ministry has proposed to amend various provisions of the Insurance Act, 1938, which includes the increase in foreign direct investment (FDI) to 100 percent, reduced capital reduction and overall license in the insurance sector.
‘Insurance for all’ by 2047
The government wants to achieve the goal of ‘insurance for all’ by 2047. The provision of overall license can also come in this bill. This will also benefit companies. At present, according to the provisions of the Insurance Act, 1938, life insurance companies can only provide life insurance cover. While general insurance companies can provide non-settlement products like health, motor, fire. IRDA does not allow overall licenses for insurance companies. In such a situation, an insurance company cannot give both life and non-life products as a unit.
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