New Delhi: Insurance legislation passed by Parliament earlier this week is set to be a game-changer for the sector's growth and help make insurance policies more accessible and affordable, as it aims to foster competition, LIC CEO and MD R Doraiswamy said. A key strength of Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill 2025 lies in its emphasis on policyholder protection and regulatory robustness, he said in a statement on Friday.
"By updating legacy provisions and strengthening governance norms, the amendments reinforce transparency, accountability, and prudential oversight across the insurance ecosystem. For policyholders, this translates into stronger safeguards, improved service standards, and enhanced confidence in long-term insurance commitments, an essential factor in a sector built on trust," he said.
Parliament on Wednesday passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill 2025, paving the way for 100 per cent foreign direct investment (FDI) in the insurance sector. Finance Minister Nirmala Sitharaman, while replying to the debate on the Bill, had emphasised the urgent need to deepen insurance penetration and awareness across the country.
She underscored the need for greater capital infusion into the insurance sector to support its long-term growth and resilience. She noted that increased capital would facilitate access to advanced technology, world-class risk assessment frameworks, and globally competitive insurance products. She explained that removing the upper cap on foreign direct investment in the insurance sector would serve as a significant catalyst for achieving these objectives, while also fostering a more conducive, investor-friendly business environment.
Changes proposed in the legislation would strengthen regulatory processes by introducing standard operating procedures for regulation-making and mandatory public consultations on all regulations issued by IRDAI, thereby ensuring transparency, consistency, and a consultative approach, he said. Doraiswamy further said, the Bill provides a framework for greater operational agility and innovation, allowing insurers to design and distribute targeted products that cater to evolving insurance needs, including retirement security, longevity solutions, and health-linked protection.
"The amendments will help accelerate insurance coverage expansion across underserved segments, including rural households, informal sector workers, women, and first-time policyholders, thereby supporting the broader public policy objective of extending formal financial protection to every citizen.
The enhanced role envisaged for IRDAI under the amended framework will guide orderly sectoral development, safeguard consumer interests, and foster innovation in alignment with national priorities," he said.
The reforms will enable LIC to further strengthen its reach, leverage technology at scale, and contribute meaningfully to the national goal of universal insurance coverage, the CEO said. The Bill is a forward-looking reform that underscores the government's commitment to building a secure, inclusive, and resilient insurance ecosystem, he said, noting that it will play a vital role in protecting households, mobilising long-term savings, and supporting economic stability as India works towards becoming a developed economy by 2047.
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