Context:
The Rajya Sabha passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, allowing 100% Foreign Direct Investment (FDI) in the insurance sector. The Bill also repeals 71 obsolete laws, signalling a major reform in India’s financial sector governance.
Key Highlights:
Policy Details
- Raises FDI limit from 74% to 100% in insurance companies.
- Foreign insurers can operate without mandatory Indian joint venture partners.
Regulatory Framework
- Insurance companies must retain management and key personnel in India.
- Aligns insurance operations with the Digital Personal Data Protection Act.
Repealing and Amending Provisions
- Repeals 71 obsolete laws including colonial-era statutes.
- Simplifies regulatory architecture of the insurance sector.
Stakeholders Involved
- Ministry of Finance
- IRDAI
- Foreign insurers
- Indian insurance companies and intermediaries
Significance / Concerns
- Government views reform as essential to deepen insurance penetration.
- Opposition raises concerns over data privacy, foreign dominance, and domestic industry burden.