Insurance brokers oppose 100% FDI proposal

The insurance broking industry is staunchly opposed to any move to gradually increase FDI in the intermediary segments to 100 per cent even as regulator IRDA is examining a top panel's recommendation in this regard.
An IRDA panel known as the Suresh Mathur Committee has recommended hiking FDI in all insurance sector intermediaries like brokers, surveyors, third-party administrators and web aggregators to 49 per cent, from the present 26 per cent immediately and then 100 per cent over the next three years.
According to industry sources, the panel headed by IRDA Joint Director Suresh Mathur had recently submitted its report.

"We will oppose the move to increase FDI cap to 100 per cent and we will do whatever we can do to resist that. We will approach the government on the issue once the report comes to us," Insurance Brokers' Association of India (IBAI) President Sohanlal Kadel told PTI.
Members of the IBAI collect close to Rs 20,000 crore premium per annum.
The Suresh Mathur Committee was formed in January 2014 on the basis of the report submitted by the Financial Sector Legislative Reforms Commission (FSLRC), headed by retired judge N Srikrishna.
The Srikishna panel (FSLRC) was essentially formed to give a push to sluggish financial sector reforms, and it had recommended that wherever the government could raise FDI without parliamentary approval, it should do so without delay.

Observing that there ought to be a level-playing field between insurance companies and their brokers, Kadel, who himself was an IRDA panel member said, "We will welcome FDI up to 49 per cent from the existing 26 per cent, but we are not in favour of 100 per cent FDI in our segment.