Finance Ministry to take up Insurance Bill in Winter Session of Parliament, says official

The long pending Insurance Bill, which seeks to raise the foreign direct investment (FDI) limit in the sector to 49 per cent, is expected to be taken up in the forthcoming Winter Session of Parliament.

"The Select Committee is looking into the Bill. We will take it up in the Winter Session," a top Finance Ministry official said.

According to experts, the reform is expected to increase the flow of foreign investment to the tune of Rs 25,000 crore into the private insurance firms. The move would help insurance companies to get much needed capital from overseas partners.

There are about two dozen private sector insurance firms both in life and non-life segment.

The Insurance Laws (Amendment) Bill, which proposes to hike the FDI limit in the insurance sector to 49 per cent, has been caught in a logjam with the Congress-led opposition insisting that it be referred to a select committee.

Bowing to opposition pressure, the government had in August agreed to refer the controversial Insurance Bill to the 15-member Select Committee. The committee is expected to submit its report by the third week of November.

In his Budget 2014-15 speech, Finance Minister Arun Jaitley had said that the insurance sector was investment starved and there was a need to increase the composite cap in the sector to 49 per cent, with full domestic management and control, through the Foreign Investment Promotion Board (FIPB) route.