Internal Government Consultations On 100% FDI In Insurance Almost Complete, Says Nagaraju Maddirala

Internal government consultations on permitting 100% FDI in insurance are almost complete, Nagaraju Maddirala, secretary, Department Of Financial Services, said, at the finance ministry's post Budget press conference in Mumbai on Monday.

Along with this, there are other rules on how investments will be made, how profits will be repatriated, and management of companies where FDI is higher, he said. The amendments will be notified after Parliament approval, he added.

"All the reforms we intend to do in the insurance sector, such as improving penetration, will be done through these reforms," Maddirala said.

The secretary also made note that this is the first time after years that all public insurance companies have made profits.

On mis-selling of insurance products, the secretary said that as the private and the public sector sell a large number of policies, there is some unsolicited persuasion of customers by banks that amounts to mis-selling, he said, adding that there are also instances where manufacturing firms or home owners have to buy insurance when paying installments to banks.

However, these complaints have reduced and the government is also taking measures to tackle the problem such as callbacks and asking only trained agents in banks to sell insurance products, he said.

Rate rationalisation on insurance is a call for the GST council, the secretary said, adding that there has been discussion on this and a decision is yet to be taken.