Insurance Amendment Bill receives Cabinet approval; proposes 100% FDI and structural reforms: Report

The Union Cabinet has approved the Insurance Amendment Billclearing a major regulatory overhaul for India’s insurance sector. The Bill proposes raising the foreign direct investment (FDI) limit in insurance companies to 100%along with several structural changes aimed at strengthening capital access and improving governance frameworks, as per CNBC-TV18.

#JustIn | Govt likely to introduce Insurance Amendment Bill in Parliament on Monday. Union Cabinet likely to have approved the Insurance Amendment Bill, sources to @Sapna_CNBC pic.twitter.com/DIaTLln6uv

— CNBC-TV18 (@CNBCTV18Live) December 12, 2025

As reported earlier, the legislation seeks to amend three key laws — the Insurance Actthe LIC Actand the IRDAI Act. The reforms are aligned with the government’s broader objective of achieving “Insurance for All by 2047.”

According to officials familiar with the matter, the proposed amendments are designed to ease capital constraints, streamline licensing norms, and enable insurers to scale operations more efficiently. Supporters believe that increasing the FDI cap could deepen financial capacity across the sector while inviting global expertise at a critical time for industry expansion.

The approval marks an important step before the Bill is tabled in Parliament.