Indian Parliament approves bill raising insurance sector FDI cap to 100%

Core Viewpoint - India's Parliament has approved legislation to raise the foreign direct investment (FDI) cap in the insurance sector from 74% to 100%, aimed at enhancing investment opportunities and regulatory oversight in the industry [1][3]. Group 1: Legislative Changes - The amendment is part of the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025, which also grants new regulatory authority to the Insurance Regulatory and Development Authority of India (IRDAI) [1][2]. - The bill amends several long-standing acts, including the Insurance Act of 1938, the Life Insurance Corporation Act of 1956, and the Insurance Regulatory and Development Authority Act of 1999 [2]. Group 2: Investment Opportunities - The amendments are designed to open up further investment opportunities in the insurance sector and update market supervision [3]. - A provision in the bill allows non-insurance companies to merge with insurance operators, providing more flexibility for business restructuring [3]. Group 3: Regulatory Authority - The IRDAI now has specific legislative powers to set limits on commissions, remuneration, or rewards paid to agents and intermediaries, as well as regulate payment methods and disclosure rules [3]. - Penalties for acting as an unregistered insurance intermediary can range from a minimum of Rs100,000 ($1,105) to a maximum of Rs100 million for appointing unregistered intermediaries [4].