The FDI limit being raised from 74% to 100% will prove to be a landmark reform in the insurance sector which will help unlock new opportunities for investment and innovation. These reforms will strengthen investor confidence, drive innovation, and support sustained economic prosperity
Ajay Kumar Srivastava, Managing Director & CEO, Indian Overseas Bank
The Union Budget of 2025 focused on MSMEs, agriculture, investment and exports has many positive decisions, and we welcome them. The enhancement of the Kisan Credit Card (KCC) loan limit to Rs 5 lakh is a huge development which will help farmers improve agricultural productivity.
Also the increase in the guarantee cover for MSME from Rs 5 crore to Rs 10 crore and for startups from Rs10 crore to Rs 20 crore will foster entrepreneurship, create job opportunities and improve the business environment. The proposal to extend interest free loans to states for 50 years is surely a bold step that will accelerate development of infrastructure and boost economic growth.
Sanjeev Mantri, MD&CEO, ICICI Lombard General Insurance
The Budget heralds a defining phase in India’s insurance evolution. The liberalization of FDI norms signifies not just capital inflow, but a fundamental shift in how we can revolutionize insurance penetration in India. This reform will enable us to bring global best practices, enhanced underwriting capabilities, and innovative InsurTech solutions to serve our diverse customer base.
The healthcare infrastructure push, particularly in cancer care, comes at a crucial juncture. As insurers, we see this as an opportunity to design specialized health coverage products that can complement the expanding medical infrastructure. This, combined with India’s emerging position as a medical tourism hub, allows us to create comprehensive cross-border health insurance solutions.
The transformative personal tax reforms will boost individual’s disposable income. This increased financial capacity, coupled with growing awareness of protection needs, presents a unique opportunity for the insurance sector.
We anticipate a fundamental shift in financial planning behaviors, where insurance moves from being an afterthought to becoming a core element of household financial security.
Tapan Sighel, MD & CEO, Bajaj Allianz General Insurance
The Union Budget 2025-26 is a forward-looking blueprint for growth, resilience, and inclusive development. The focus on strengthening the middle class through enhanced tax exemptions will put more money in people’s hands, boosting consumption, savings, and overall economic momentum.
A key highlight is the opening up of 100% FDI in insurance, which will foster greater competition, bring in global expertise, and drive deeper penetration across the country.
With the move to allow 100% FDI in insurance, we could see India moving towards a future with 1,000 insurers in the next decade. A larger number of players will bring greater competition, leading to enhanced innovation, customer-centric products, and improved service delivery. More insurers mean better awareness, wider choices for consumers, and a stronger push for financial protection across all segments of society.
Naveen Chandra Jha, MD & CEO,SBI General Insurance
Budget 2025 marks a transformative step for the insurance sector in India, particularly with the introduction of 100% FDI. This reform is set to drive deeper market penetration by attracting greater capital inflows, fostering competition, and integrating global best practices.
The government’s commitment to strengthening healthcare infrastructure, including the establishment of Day Care Cancer Centres in district hospitals, is a significant step toward improving critical care access. At SBI General, we remain dedicated to bridging the protection gap by ensuring wider penetration of health insurance across urban and rural India.
Additionally, the proposed tax reforms, including TDS rationalization and increased thresholds for senior citizens, will empower taxpayers and promote greater financial inclusion. Collectively, these initiatives lay the foundation for a robust insurance ecosystem, supporting the government’s vision of ‘Insurance for All’ by 2047.
Tarun Chugh,MD & CEO, Bajaj Allianz Life Insurance
“The Union Budget has clearly focused on driving consumption led growth and foster inclusive development. A key highlight is the increase in the FDI limit in the insurance sector from 74% to 100%, a move set to bring in fresh capital and bolster the industry’s financial strength. The decision reflects the government’s continued commitment to making India a prime investment hub for stable, long-term capital.
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.”
Rakesh Jain, CEO, Reliance General Insurance
The decision to increase the FDI limit in insurance from 74% to 100% marks a significant milestone in the sector’s evolution. This transformative step will not only unlock fresh capital flows but also accelerate technological advancements, driving innovation and global best practices. As foreign participation increases, we can expect elevated customer experiences and more competitive offerings.
However, as we embark on this journey, it’s essential to strike a balance between growth and policyholder protection. A robust regulatory framework will be crucial in safeguarding policyholder interests while fostering sustainable growth. We believe this move will ultimately strengthen India’s insurance ecosystem, driving growth and development that benefits all stakeholders.
Venky Iyer, Managing Director & Chief Executive Officer at Tata AIA Life Insurance.
The Finance Minister delivered a growth-oriented budget while staying firmly on the path of fiscal consolidation pegging the fiscal deficit for FY 26 at 4.4%. A massive ₹1 lakh crore in personal tax relief directed at the middle class, will boost consumption, and enable households to invest in their financial security.
Initiatives around channelizing credit to the MSME sector with focus on labour intensive manufacturing, facilitating investments, smoothening the processes in the exports arena, reforms around the ease of doing business with an overall emphasis on minimizing onerous regulations augur well for the economy and its participants.
At Tata AIA, we stay committed to partnering with Individuals and Enterprises in their growth journey through our life insurance solutions.
G.Srinivasan , MD & CEO of Galaxy Health Insurance
The increase in FDI in insurance sector from 74% to 100% is very positive as it will help in bringing large capital required by insurance sector for the high growth the sector is expected to post towards the goal of Insurance for All.
The health care sector has received a boost with many measures. The increase in medical seats will add to availability of doctors for better health care. The setting up of Day care cancer centres in all District hospitals is a welcome measure. The PMJAY cover for one crore GIG workers will bring health insurance for large number of people.
The reduction in personal tax will increase the disposable incomes of people and will facilitate them to focus on availing health insurance which is very important for people.
Extension of tax breaks for insurance companies in IFSC GIFT CITY for another 5 years is welcome.
Anand Roy, MD & CEO of Star Health & Allied Insurance
The 100% FDI allowance in insurance is a welcome move that will attract global capital, enhance competitiveness and efficiencies, and help expand insurance coverage in India where penetration remains below 5%. This aligns with IRDAI’s vision of ‘Insurance for All by 2047’, demonstrates the government’s commitment to financial inclusion and will further strengthen India’s economic position. Additionally, eliminating customs duty on 36 critical medications, including cancer will make life-saving treatments more affordable and accessible.
Pallavi Malani, India Leader-Insurance Practice, BCG
The Union Budget announcement regarding the Insurance sector has come as a welcome move for the industry. The increment of FDI limit to 100% from 74% will prove to be a significant shift for the Indian Insurance Sector.
Increasing the FDI limit will attract global insurers driving capital infusion, fostering product innovation and bringing in advanced risk management practices. It is also in alignment with the government’s vision of ‘Insurance for All’ by 2047, ensuring deeper penetration and financial security for Indians at large.
While global insurers will need to adapt their operations to very specific and nuanced Indian market dynamics, in the coming months, we expect to see heightened investment and M&A activities.
Krishnan Ramachandran, MD & CEO, Niva Bupa Health Insurance
“This Budget reaffirms India’s commitment to inclusive growth, prioritizing infrastructure, healthcare, and financial empowerment. The finance minister has announced many measures which will ease the financial burden, especially for the middle class and spur economic participation.
The increase in the income tax exemption limit to ₹12 lakh will provide significant relief and increase disposable income, thereby driving consumption. The government’s focus on healthcare sector in the budget would make essential treatments more affordable and widely available.
The FDI limit being raised from 74% to 100% will prove to be a landmark reform in the insurance sector which will help unlock new opportunities for investment and innovation. These reforms will strengthen investor confidence, drive innovation, and support sustained economic prosperity.
Sumit Bohra, President, Insurance Brokers Association of India
“The announcement of enhancement in FDI limit in the insurance sector to 100% in the Union Budget 2025 is a positive move. This will now help to attract more foreign capital, enhance underwriting capacity, and foster innovation through global partnerships.
The government’s acknowledgment of insurance as a critical pillar for financial security is encouraging. Also the decision on nil income tax payable up to Rs12 lakh, this segment of consumers should become target for buying insurance increased cover. This measure of the government can contribute to increasing insurance penetration.”
Sarbvir Singh, Joint Group CEO, PB Fintech
Budget 2025 brings a strong focus on the public healthcare infrastructure. The push for ‘Heal in India’ and medical tourism, backed by private-sector collaboration and eased visa processes, strengthens India’s position as a preferred destination for advanced and affordable healthcare. Broadband connectivity to all government primary health centers in rural areas is also set to improve the reach of medical services.
As another major relief, the Budget expands the list of life-saving cancer drugs exempt from basic customs duty, reducing treatment costs and making essential medicines more affordable. These measures signal a clear commitment to making quality healthcare more accessible and affordable.
Srikanth Kandikonda, Chief Financial Officer, ManipalCigna Health Insurance
We welcome the government’s decision to increase the FDI limit in the insurance sector from 74% to 100%. This progressive move will drive greater capital inflows into the sector, also improve insurance penetration.
A key highlight of the Union Budget is the significant relief for the middle class, with no income tax payable on earnings up to ₹12 lakh under the new tax regime. This translates into greater income in the hands of people, empowering individuals to invest in financial security tools like health insurance.
At ManipalCigna Health Insurance, our focus remains on India’s missing middle population, and this initiative aligns perfectly with our commitment to expanding access to quality healthcare protection.
Additionally, the government’s plan to establish 200 daycare cancer centres in district hospitals by 2025-26 is a commendable step toward strengthening healthcare accessibility. These centers will bridge critical care gaps, ensuring timely and affordable treatment for cancer patients across India. We look forward to supporting initiatives that enhance healthcare access and financial protection for all.
Animesh Das, MD and CEO, ACKO General Insurance
The government’s move to allow 100% FDI in insurance not only signals a commitment to unlocking competitive, innovative capital but also sets the stage for a tech-driven evolution in how we serve our customers. Coupled with a significant boost in health infrastructure, these measures lay the groundwork for a more connected, efficient, and accessible healthcare ecosystem.
Being a tech-first insurance company, we see this as a call to further innovate—leveraging data, digital platforms, and customer-centric solutions to make quality insurance and healthcare accessible to every Indian. More than just a policy reform, it will act as a strategic enabler for the next phase of industry evolution”
Balamurugan Shanmugam, Chief Investment Officer, Aviva India
The increase of limit from 74% to 100% should not just be viewed as an incremental 26 percentage points. This is rather a paradigm shift. This is expected to bring in more players and more capital from existing players supporting IRDAI’s vision of “Insurance for all by 2047.”
In addition to brining in much-needed FDI into the country, this will also bring in better technical capabilities and new propositions for the overall benefit of the customers. As the economic survey pointed out, out of the total FDI received in Apr-Sep’24 period, 12% came into Insurance sector. This was a result of the previous increase in FDI limit from 49% to 74% in 2021.”
Jude Gomes, MD & CEO, Ageas Federal Life Insurance
Ageas Federal Life Insurance has already experienced the positive impact of enhanced foreign investment, having been one of the first Indian insurers to embrace the 74% FDI limit. This move has driven innovation, operational efficiency, and customer-centric solutions within the industry.
The government’s decision to increase the FDI limit in the insurance sector to 100% is a landmark reform that will significantly strengthen the industry by attracting fresh capital, global expertise, and cutting-edge innovation. Furthermore, the revamped Central KYC Registry is a welcome step toward strengthening data security and ensuring a seamless, trusted experience for customers.
By prioritizing transparency and ease of doing business, the government is laying a strong foundation for a more resilient and digitally empowered financial ecosystem. At Ageas Federal Life Insurance, we wholeheartedly welcome these progressive reforms and look forward to leveraging these opportunities to expand our reach and further our mission of securing a fearless future for individuals across India.
Sandeep Dadia, CEO & Country Head, Lockton India
Amongst multiple key aspects, the Union Budget lay much emphasis on two key areas— Marine industry and attracting more FDI in India.
The extension of Basic Customs Duty (BCD) exemption on raw materials, components, and consumables for shipbuilding and shipbreaking for another 10 years is a significant boost for the maritime industry. Given the long gestation period of shipbuilding, this move will enhance competitiveness and drive growth.
As a leading insurance broker specializing in P&I, marine, and shipping risks, we see this as a vital step that will accelerate industry expansion and increase the need for comprehensive marine insurance solutions.
Additionally, the review and simplification of existing guardrails and conditions for foreign investment will create a more investor-friendly environment, firmly positioning India as a leading global insurance market.
It wouldn’t be wrong to say that this is a transformational moment for the sector, enabling insurers and brokers to provide more customized, efficient, and technology-driven risk solutions that shall cater to the country’s evolving aspirations.
Pavanjit Singh Dhingra, Joint Managing Director, Prudent Insurance Brokers
“The increased FDI limit in the insurance sector to 100% from 74% is a welcome move and will now provide the much-required growth capital for the industry. With global companies seeking investment opportunities in India, this move will lead to increased innovation, capacity and choice for the end consumers both in terms of products and services. This move will further expand coverages for businesses, cyber risks and credit protection.
The decision by the government is encouraging for the sector and is in alignment with its broader goal of ‘Insurance for All by 2047’.”
Sanjay Agarwal, Senior Director, CareEdge Ratings
In pursuit of insurance for all, the enhanced FDI limit in insurance sector to 100% from 74% would provide necessary growth capital for the industry. It would also encourage more Global players to look towards the country. Long term funding remains a key requirement for the capex, which insurance sector addresses’’.
TDS limit increase for senior citizen
‘’Senior Citizens have over 38% share of the aggregate individual deposits as of March 2024. The TDS limit increase for senior citizens from Rs 50000 to Rs 1 lakh to facilitate deposit mobilisation and support banks’ Credit to Deposit ratio’’.
MSME
MSMEs have an estimated credit gap of around Rs 28 lakh crore. Banks account for a significant share of MSME lending. Doubling of the Credit guarantee cover from Rs 5 crore to Rs 10 crore for micro and Small. For export oriented MSMEs Term loans up to Rs 20 cr would enable MSMEs access funds for capital expenditure / working capital at competitive rates.
Balachander Sekhar, Co-founder and Chief Executive Officer, RenewBuy
“The government’s announcement to allow 100% Foreign Direct Investment (FDI) in the insurance sector will help facilitate entry of more players into the Indian market, thereby ushering in a new wave of competition, innovation and growth. This influx will drive Indian insurers to adopt global best practices in product and processes, innovation as well as cutting-edge technologies. All of these can further help improve underwriting, claims management and customer service.
In a capital-intensive market like insurance, the proposal will help inject substantial capital into the sector, enabling insurers to expand their operations, enhance their product offerings, and strengthen financial reserves. It can also impact improved margins for Indian insurers, listing of insurance companies and newer tax rules. We appreciate and welcome this initiative by the government.”