India Allows 100% FDI in Insurance Under Automatic Route

India's Finance Ministry notified on May 2, 2026, that foreign direct investment in the insurance sector will be permitted up to 100 percent under the automatic route, allowing full foreign ownership in insurance companies and intermediaries such as brokers, reinsurance brokers, consultants, corporate agents, third-party administrators, surveyors, loss assessors, managing general agents, and insurance repositories.

The policy change applies to the aggregate holdings by foreign investors, including portfolio investors, up to 100 percent of the paid-up equity capital. Investments proceed automatically but require approval and verification by the Insurance Regulatory and Development Authority of India to ensure compliance. A key exception maintains the foreign investment cap at 20 percent for Life Insurance Corporation of India, preserving restrictions on the state-run insurer.

Companies receiving foreign investment must appoint at least one resident Indian citizen as chairperson of the board, managing director, or chief executive officer. They also must adhere to disclosure norms, pricing guidelines under the Reserve Bank of India's Foreign Exchange Management Act regulations, and...