Union Cabinet approves Insurance Amendment Bill; details to be disclosed shortly
The proposed legislation seeks to amend three core acts — the Insurance Act, the LIC Act and the IRDAI Act — to unlock new avenues for capital infusion, simplify licensing and entry norms, and tighten governance and oversight across the industry.
- Dec 12, 2025,
- Updated Dec 12, 2025 3:43 PM IST
The Union Cabinet, chaired by Prime Minister Narendra Modi, on Friday cleared a landmark bill to raise the foreign direct investment (FDI) cap in insurance companies to 100%, alongside a set of structural reforms aimed at deepening and modernising the sector. A formal briefing on the Cabinet decision is slated for 4 pm.
The move is expected to draw substantial overseas capital into India’s insurance industry, intensify competition among players, and ultimately improve product offerings and service quality for customers. Higher FDI limits are also seen as critical for strengthening insurers’ balance sheets and supporting long-term infrastructure and social sector funding.
The proposed legislation seeks to amend three core acts — the Insurance Act, the LIC Act and the IRDAI Act — to unlock new avenues for capital infusion, simplify licensing and entry norms, and tighten governance and oversight across the industry.
These changes are aligned with the government’s broader vision of “Insurance for All by 2047,” which aims to achieve universal risk protection for individuals and businesses as India approaches its centenary of Independence.
By enabling 100% foreign ownership, the Centre is betting that global insurance majors will bring in not just capital, but also advanced technology, innovation in product design and underwriting, and global best practices in risk management and customer service.
The Union Cabinet, chaired by Prime Minister Narendra Modi, on Friday cleared a landmark bill to raise the foreign direct investment (FDI) cap in insurance companies to 100%, alongside a set of structural reforms aimed at deepening and modernising the sector. A formal briefing on the Cabinet decision is slated for 4 pm.
The move is expected to draw substantial overseas capital into India’s insurance industry, intensify competition among players, and ultimately improve product offerings and service quality for customers. Higher FDI limits are also seen as critical for strengthening insurers’ balance sheets and supporting long-term infrastructure and social sector funding.
The proposed legislation seeks to amend three core acts — the Insurance Act, the LIC Act and the IRDAI Act — to unlock new avenues for capital infusion, simplify licensing and entry norms, and tighten governance and oversight across the industry.
These changes are aligned with the government’s broader vision of “Insurance for All by 2047,” which aims to achieve universal risk protection for individuals and businesses as India approaches its centenary of Independence.
By enabling 100% foreign ownership, the Centre is betting that global insurance majors will bring in not just capital, but also advanced technology, innovation in product design and underwriting, and global best practices in risk management and customer service.