FDI in insurance may be hiked to 49%

MUMBAI: The government is considering a proposal to hike the limit on foreign investment in the insurance sector from 26 per cent to 49 per cent, minister of state for finance Anandrao Adsul said.
The committee headed by NK Singh, member-secretary of planning commission had proposed that the foreign equity cap in insurance should be hiked to 49 per cent.
“We are working on the proposal to raise the ceiling (from 26 per cent) as growth in the insurance sector will increase employment opportunities�, Adsul told reporters on the sidelines of an insurance seminar organised by Prabodhan Prakashan, a pro-Shiv Sena outfit, here on Saturday.
“However, no time limit has been set for taking decision on it as we want to consult industry and stakeholders�, the minister said.
He also said that the government was considering a minimum quota of motor insurance for private insurers since they were seen to be avoiding underwriting business under this loss-making portfolio. LIC chairman S B mathur said the role of insurance advisors was crucial in expanding the business.