Union Budget 2021: In a bid to attract investment in the insurance sector and create a new avenue for revenue for the insurers operating in India, the Finance Minister Nirmala Sitharaman announced to raise the FDI in insurance sector from existing 49 per cent to 74 per cent. She said that the move has been taken after seriously scrutinizing the demand of the insurers for the same.

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Announcing about the raise in FDI cap from her Union Budget 2021 Nirmala Sitharaman said, "To push investment in the insurance sector, we propose to increase the Foreign Direct Investment (FDI) limit in the insurance sector from 49 per cent to 74 per cent."

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Hailing the Modi Government's move to raise the FDI cap in insurance sector; Divam Sharma, Co-founder, Green Portfolio, SEBI Regd. Portfolio Management services said, "Insurance India is one of the fastest-growing Insurance markets. Insurance tech has also generated high investor interest in recent years with companies like policy bazaar, acko, digit raising high amounts of FDI. Incremental foreign capital will enhance the penetration of Insurance in India and will also gradually help in reducing the insurance cost with higher volumes."

Welcoming the Narendra Modi Government's move to raise FDI limit in insurance sector Sumit Bohra, President at Insurance Brokers Association of India (IBAI) said, "Union Budget of 2021-2022 has given a major thrust on accelerating capital requirement through divestment and increase in FDI in the insurance sector. The Vehicle Scrappage policy will help in sales of new Motor Vehicles and in turn will contribute to the Increase in New Motor Premium. The increase in FDI, announced by the FM, from 49 per cent to 74 per cent in Insurance Sector will give a major boost to the Insurance Industry and will help in garnering more capital, improve solvency and retention capacity within our Country."