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Centre allows 100% FDI in insurance but keeps one key cap on LIC
Business
Published on 3 May 2026
LIC stays capped at 20% even as others open fully
India has notified 100% foreign direct investment in insurance companies via the automatic route, coming into effect under the Insurance Laws (Amendment) Act, 2025. The move follows Cabinet clearance and raises the FDI cap from 74% to 100%, aiming to boost long-term capital and insurance penetration. Foreign investment still needs IRDAI regulatory clearance, with conditions including resident leadership, RBI FEMA pricing norms, and LIC remains capped at 20%.
- 100% FDI in insurance firms allowed under automatic route after Cabinet clearance
- Foreign investors require IRDAI regulatory clearance despite no prior approval
- Resident Indian leadership is mandatory for foreign-backed insurers
- LIC’s automatic-route cap stays at 20% while intermediaries also open up
Read the full story at Inc42
This summarization was done by Beige for a story published on 
Inc42