The Indian government is likely to introduce a Bill seeking amendments to the Insurance Act, 1938, during the Budget session set to begin on 23 July.
Some of the provisions, which could be part of the amendment bill, include the introduction of a composite insurance licence, differential capital, reduction in solvency norms, captive insurance licences, changes in investment regulations, one-time registration for intermediaries and allowing insurers to distribute other financial products, sources told Press Trust of India, the country’s largest news agency.
The move will enable the entry of a wider range of different types of insurance companies like in the banking sector. Banks are currently categorised as universal banks, small finance banks, and payments banks.
At present, insurance companies cannot offer both life and non-life products as one entity.
The draft Bill is ready and it has to go to the Cabinet for its approval, sources said, adding that the Finance Ministry is hoping that it gets introduced in the upcoming Budget session.
Currently, there are 25 life insurance companies and 32 non-life or general insurance firms in India. These also include the state-owned Agriculture Insurance Company of India and the government-owned export credit agency ECGC.