The Insurance Regulatory and Development Authority of India (IRDAI) has established a seven-member committee, led by former State Bank of India (SBI) chairman Dinesh Khara, to review key aspects of the Insurance Act, 1938 and propose amendments to the Insurance Act Amendment Bill. The committee’s mandate is to review previous proposals and incorporate new suggestions, rather than propose additional amendments. The committee members are all experienced professionals from the insurance and banking sectors, with expertise in various areas, including insurance, finance, and regulations.
The Insurance Act Amendment Bill was expected to be introduced in the second leg of the Budget session, but due to the delay, the Department of Financial Services (DFS) will draft a revised amendment bill for stakeholder consultations before reintroducing it in Parliament. The proposed amendments include increasing foreign direct investment (FDI) in the insurance sector to 100%, reducing the paid-up capital, and providing for a composite license, among others.
According to M Nagaraju, secretary of the Department of Financial Services (DFS), internal consultations have been completed on the Insurance Amendment Bill, which will include details on investments and repatriation of profits in case of FDI. The composite license in insurance is also part of the reforms. The committee’s review and recommendations will play a crucial role in the finalization of the Insurance Act Amendment Bill.