Finance minister Nirmala Sithraman on Saturday proposed to raise the foreign direct investment limit to 100 per cent from 74 per cent.

"This enhanced limit will be available for those companies which invest the entire premium in India. The current guardrails and conditionalities associated with foreign investment will be reviewed and simplified" she said.

To enhance the FDI limit, the government will have to bring amendments to the Insurance Act 1938, the Life Insurance Corporation Act 1956, and the Insurance Regulatory and Development Authority Act 1999.

"FDI limit in insurance was raised from 49 per cent to 74 per cent in 2021. Increasing this further to 100 per cent would be beneficial to the industry if it translates to increase in capital investments and subsequent growth in insurance penetration," said Vibha Padalkar, MD & CEO, HDFC Life.

"Greater foreign participation, will accelerate the adoption of global best practices, introduce innovative products, and elevate customer service standards. Additionally, the mandate to invest premiums within India ensures that these funds contribute to domestic economic growth and infrastructure development. The next five years present a significant and an exciting opportunity to propel the industry forward onto greater heights," said Tarun Chugh, MD & CEO, Bajaj Allianz Life Insurance.

"The provision that this enhanced limit applies only to companies investing the entire premium in India further encourages domestic investment, strengthening India’s position as a global investment hub while ensuring long-term sector sustainability," said Satishwar B., MD & CEO, Bandhan Life Insurance.

"Initiatives like addition of day care cancer centres at all district hospitals over the period of next three years and exemption of customs duty for 36 lifesaving drugs are examples of the Government's efforts on building up a conducive health care system in the country," said Anuj Tyagi, MD & CEO, HDFC ERGO General Insurance.

"Complementary with these initiatives is the extension of PM Jan Arogya Yojana to provide health insurance for gig workers will provide a safety net for the vital segment of the workforce, which is largely underserved at present. Also, reduction of tax burden on the salaried individual will provide them with an increased disposable income, thereby swaying the insurance consideration by the consumers in a favourable direction."