Industry cheers as Budget 2021 increases FDI limit in insurance to 74%

The Insurance Act presently says a company has to be 'Indian-owned and controlled'

The limit on foreign direct investment (FDI) in Indian insurance companies will be lifted from 49 per cent to 74 per cent, said Finance Minister Nirmala Sitharaman on Monday in her Budget speech for 2021-22, accepting a demand the industry had proposed for long.

The law presently says an Indian insurance company has to be "Indian-owned and controlled". This gives the Indian partner the right to appoint a majority of directors or control the management of a company. The Insurance Act will be updated to allow foreign ownership in insurance with safeguards.
 

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“The announcement by