The Insurance Amendment Bill, intended to allow 100% foreign direct investment (FDI) in the insurance industry, will be tabled in Parliament in the coming monsoon session, sources and Indian news reports indicate. The bill draft has been ready and is expected to be taken to the Cabinet for clearance in the near future.

As soon as the bill is approved by the Cabinet, the Ministry of Finance's Department of Financial Services will initiate bringing it to Parliament. The introduction of the law is expected in the monsoon session, generally beginning in July.

As a part of overall financial sector reforms, Finance Minister Nirmala Sitharaman said in this Budget that the suggestion to raise the foreign investment ceiling in insurance companies from the current 74% to 100% was made. The finance ministry has put forward a range of amendments in the Insurance Act of 1938, ranging from increasing the FDI limit to 100% to the lowering of the paid-up capital requirement and addition of provisions relating to a composite license.

The bill further seeks to make it possible for agents to sell policies of more than one insurer, shifting from the current exclusivity model. Under a mega-overhaul of the legislations, amendments will also be introduced to the Insurance Regulatory and Development Authority Act of 1999 and the Life Insurance Corporation Act of 1956, along with modifications in the Insurance Act of 1938.India presently has 25 life insurance companies and 34 non-life or general insurance companies.