EconomyMonday, 4 May 2026·https://testbook.com/current-affairs/04-may-2026-daily-current-affairs
India notifies 100% FDI in insurance sector under automatic route
India notified 100% FDI in the domestic insurance sector under the automatic route, with LIC still capped at 20%.
Key highlights
Direct fact
In 2026, the Government of India notified 100% foreign direct investment in the domestic insurance sector under the automatic route, while the Life Insurance Corporation of India (LIC) continues to have a 20% cap under the same route.
Key specifics
- The 100% FDI rule applies to domestic insurance companies and intermediaries.
- LIC remains capped at 20% foreign investment under the automatic route.
- At least one resident Indian citizen must be Chairperson, Managing Director or Chief Executive Officer.
- The policy aligns with the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025.
- The provisions take effect from 5 February 2026, excluding Section 25.
Exam lens
Question type: economy + regulatory policy; remember 100% FDI, LIC 20%, 5 February 2026, and the resident Indian leadership condition. TNPSC may ask which regulator verifies foreign investment and what the automatic route means.