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Property & IRDAI Licensed Insurance Agent in Indore. Expert in Health Gap Analysis. Travel Insurance. Insurance is the subject matter of solicitation.
Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025
Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025
The primary aim to introduce this bill was to attract FDI, this is what media will have you. But attracting FDI is only the means to achieve other goals. 100% FDI is a tool to slice through the layer and reach to more and more people, there by increasing Insurance Penetration.
India is one of the largest market for insurance in the world. With highest population India is simply a biggest potential market. Yet "Insurance Penetration" (how much of our GDP comes from insurance premiums) is at 4% (including all insurance). while the global benchmark/average stands at 7%. In some countries this percentage goes to double digits.
What this means in layman's term is people in other developed countries are buying insurance much more than us. In India not everyone has health insurance, many drive without vehicle insurance, many can't afford life insurance products. So to battle these issues Indian market needed better insurance products and lower premiums. To achieve this India needed to increase the competition between insurers (Insurance Companies).
That's the reason why FDI was increased from 74 % to 100%. By opening the market through foreign direct investment, India has now allowed foreign companies to market and sell their products. This will increase options for policy holders and there by increasing competition among insurance companies which will result in lower premiums. when premium will be lowered Govt. hopes to reach more and more people.
The "Guardrail"
The "Guardrail"
The government isn't just letting foreign companies in; it's bringing them in under Indian rules. With mandatory Indian leadership at the helm and IRDAI’s new 'disgorgement' powers, these companies will be fully accountable to Indian law. Your money stays in India, and your data stays protected under the DPDP Act.
For foreign companies to be able to market and sell their products in India, they will have to comply by the guidelines set by IRDAI and moreover they too will be licensed by IRDAI giving full control to Govt. in case of disputes. Additionally, there is a prerequisite condition to have at least one Indian among the top leadership of the company.
In essence, Government has given foreign companies the length to operate but is holding the leash just in case any of them tries something illegal.
What can we expect from Sabka Bima Sabki Raksha Bill
What can we expect from Sabka Bima Sabki Raksha Bill
The move to 100% is a signal to global giants that they can now own their Indian business entirely. For customers, this means:
More Budget: Global companies will spend more on technology and better claim processes since they own 100% of the profit.
Better Products at competitive rates: Expect specialized insurance (like EV-specific motor insurance or niche health covers) that was previously only available in the US or Euro
The "Sachet" Revolution: The 2025 Bill also encourages Micro-insurance. Expect to see "sachet-sized" products (e.g., health insurance for just a week of travel or specific disease cover for ₹100/month) which will help you reach the population in Indore that currently finds insurance "unaffordable."
Other Key Features of the bill Sabka Bima Sabki Raksha
Other Key Features of the bill Sabka Bima Sabki Raksha
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