MoF Amends FEMA Rules, Allows 100% FDI in Insurance sector via Automatic route
In May 2026, the Ministry of Finance (MoF) notified amendments to the Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2026, allowing 100% Foreign Direct Investment (FDI) in Indian insurance companies and insurance intermediaries via the automatic route, subject to regulatory approval and compliance with the Insurance Act, 1938.
Retain LIC Cap: However, MoF has clarified that foreign investment in Life Insurance Corporation of India (LIC) continues to be capped at 20% under the automatic route.
Eligible Entities: As per MoF official notification, 100% FDI now applicable to a wide range of insurance-related entities, including insurance brokers, reinsurance brokers, insurance consultants, corporate agents, third-party administrators, Surveyors and Loss Assessors, among others.
In May 2026, the Ministry of Finance (MoF) notified amendments to the Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2026, allowing 100% Foreign Direct Investment (FDI) in Indian insurance companies and insurance intermediaries via the automatic route, subject to regulatory approval and compliance with the Insurance Act, 1938.
Retain LIC Cap: However, MoF has clarified that foreign investment in Life Insurance Corporation of India (LIC) continues to be capped at 20% under the automatic route.
Eligible Entities: As per MoF official notification, 100% FDI now applicable to a wide range of insurance-related entities, including insurance brokers, reinsurance brokers, insurance consultants, corporate agents, third-party administrators, Surveyors and Loss Assessors, among others.
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