FDI limit in the Insurance sector has been raised from 74 per cent to 100 per cent
- FDI limit in the Insurance sector has been raised from 74 per cent to 100 per cent.
- In the budget FY25, Finance Minister Nirmala Sitharaman raised FDI limits in the insurance sector from 74 per cent to 100 per cent.
- This enhanced limit will be for those companies who will invest the entire premium in India.
- It will attract foreign investment, enhance competition, improve insurance penetration, and align with global practices.
- At present, there are 26 life insurers and 27 general insurers including 2 specialized insurers.
- The insurance sector has registered approximately 10% CAGR in the last five years.
- The FDI limit in insurance was introduced in 2000 with a cap of 26%. It was gradually raised to 49% in 2015 and 74% in 2021.
- In 2019, the Insurance intermediaries, such as brokers, were allowed 100% FDI.
- The Government aims to use the full potential of the Indian insurance sector, which is projected to grow at 7.1% annually over the next five years.
- Countries like Canada, Brazil, Australia, and China have allowed 100% FDI in their insurance sectors.
