The Ministry of Finance on 13th April 2021 has notified The Draft Indian Insurance Companies (Foreign Investment) (Amendment) Rules, 2021 and has invited objections or suggestion from the public which shall be addressed to the Government of India, Department of Financial Service, Insurance-II Section, Room No. 10, Jeevan Deep Building, 2nd floor, Sansad Marg, New Delhi – 110 001 within 15 days.
As per the new rule 3, no Indian insurance company shall allow the aggregate holdings by way of Total Foreign Investment in its equity shares by Foreign Investors, including portfolio investors, to exceed seventy-four percent of the paid-up equity capital of such Indian Insurance Company.
In an Indian Insurance Company having foreign investment, a majority of its directors and at least one among the chairperson of its Board, its managing director and its Chief Executive Officer, shall be Resident Indian Citizens.
Further in case of any increase of foreign investment of an Indian insurance company shall be in accordance with the pricing guidelines specified by Reserve Bank of India under the Foreign Exchange Management Act, 1999.