The government has decided to permit 100% foreign direct investment (FDI) in insurance intermediaries is expected to help foreign brokerages buy into Indian companies and deepen the market in terms of new products and technology. This could help bring in global products, practices, and sales strategies to India’s insurance market.
Intermediaries for Insurance are brokers or agent whose role is to link between insurance companies and customer. FDI in the sector was capped at 49 per cent under the automatic route, including for insurance broking, insurance companies, third party administrators, surveyors, and loss assessors.
According to the Union budget 2019, it is allowed 100% FDI in insurance companies and the department of financial services issued a notification. Under the notification issued on 27 August, any non-insurance company, such as a bank with more than 50 per cent revenue from non-insurance business, will have to stay to the respective FDI limit for that particular sector.
“The changes in FDI policy will result in making India a more attractive destination, leading to benefits of increased investments, employment and growth,” the government said.
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