Insurance Amendment Bill 2025: India’s Lok Sabha has passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025.
The bill will allow up to 100 percent foreign direct investment (FDI) in insurance in India. This could significantly improve capital availability and affordability for policyholders.
Finance Minister Nirmala Sitharaman remarked the removal of FDI cap would possibly help attract global technology, long-term capital and risk management practices. This, in turn, could lead to wider product offerings and more competitive pricing.
Sitharaman also pointed to a series of steps that have been taken by India for strengthening public sector insurers. The Finance Minister added the recent GST relief on health and life insurance premiums have improved affordability for the common man.
What Does Insurance Amendment Bill 2025 Mean For India?
The Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025, amends the Insurance Act, 1938, the LIC Act, 1956, and the IRDAI Act, 1999.
- The bill increases the FDI limit from 74 to 100 percent. This will allow mergers between insurance and non-insurance companies.
- It will introduce new policyholder protection mechanisms and strengthen regulatory powers.
- The Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025, has the potential of reducing administrative friction.
- It can remove periodic license renewals, helping intermediaries to emphasize more on customer servicing instead of compliance processes.
- Manish Dodeja, Chief Operating Officer at Care Health Insurance, remarked access to global expertise and capital that may assist enhance claims systems and digital capabilities that can significantly improve service consistency for policyholders over time.
Consumer-Facing Implications
According to legal experts, the Bill helps in creating an enabling framework instead of prescribing all operational details upfront.
The bill reduces barriers for foreign insurers and expands the enforcement powers of the Insurance Regulatory and Development Authority of India (IRDAI) while modernizing intermediary regulations.
