Government increases FDI in Insurance Sector from 49% to 74%

S. No.

Impact

1

Entry No. (C) in Sl. No. F.2.1, is substituted with following entry:-

“(c) Applications for foreign direct investment in private banks having joint venture or subsidiary in insurance sector may be addressed to the Reserve Bank for consideration in consultation with the Insurance Regulatory and Development Authority of India, in order to ensure that the limit of foreign investment applicable for the insurance sector as specified in serial number F. 8.1 and F. 8.2 is not breached.”;

In the existing provision, the limit of 49% of investment applicable for the insurance sector was provided for the said purpose which is now replaced with a reference to serial number F. 8.1 and F. 8.2, being 74% or 100% as the case maybe.

2

Against Sl. No. F. 8.1, in column (3), under the heading “Sectoral Cap,” limit has been increased from 49% to 74%

The Sectoral cap for investment has been increased from 49% to 74% for following sectors:

a) Sector/Activity

b) Insurance Brokers

c) Third Party Administrators

d) Surveyors and Loss Assessors

e) Other Insurance Intermediaries appointed under the provisions of Insurance Regulatory and Development Authority Act, 1999

3

Against Sl. No. F. 8.3, in column (2), under the sub-heading “Other conditions,”-

(A) in clause (a), for the words “forty nine,” the word “seventy-four” have been substituted;

(B) in clause (b), for the words “forty nine,” the word “seventy-four” shall be substituted;

Amendments have been made to increase the limit of investment by foreign investors to 74% from existing 49%