The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved a landmark reform to raise the FDI limit in insurance companies to 100%, along with wide-ranging amendments to modernize and strengthen the insurance sector.
Commenting on current development: Debashish Banerjee, Partner, Deloitte India
“While the intent to allow 100 percent FDI in insurance was indicated earlier this year, today’s announcement is a positive step in translating that intent into action. Over the past few months, we have seen growing interest from several global insurers who are actively evaluating India as a long-term market, and greater clarity on ownership norms will help in moving those conversations forward. As the detailed rules, regulations and operational guidelines emerge, this should give investors the confidence to commit capital and capability more meaningfully. For the industry, this is a constructive development. To enable the sector to scale fully, it will be important to see how the other reforms the government is contemplating come together, so that growth, governance and inclusion progress in parallel.”
