Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2026

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insurance brokers, insurance consultants, corporate agents, third party administrator, Surveyors and Loss Assessors, managing general agents, insurance repositories and such other entities, as may be notified by the Insurance Regulatory and Development Authority of India from time to time.

(a) The aggregate holdings by way of total foreign investment in the equity shares of an Indian

Insurance Company by foreign investors, including portfolio investors, is permitted up to one

hundred per cent. of the paid- up equity capital of such Indian Insurance company.

(b) The foreign investment up to one hundred per cent. of the total paid-up equity of the Indian

Insurance Company shall be allowed on the Automatic Route subject to approval and verification

by the Insurance Regulatory and Development Authority of India.

(c) Foreign investment in this sector shall be subject to compliance with the provisions of the

Insurance Act, 1938(4 of 1938), and the condition that Companies receiving FDI shall obtain

necessary licence or approval from the Insurance Regulatory and Development Authority of India for undertaking insurance and related activities.

(d) (I) In an Indian Insurance Company having foreign investment, at least one among the

Chairperson of its Board, its Managing Director and its Chief Executive Officer, shall be Resident

Indian Citizens.

(II) An Indian Insurance company having foreign investment shall comply with the provisions

under the Indian Insurance Companies (Foreign investment) Rules, 2015 and the applicable rules or regulations notified by the Department of Financial Services or Insurance Regulatory and Development Authority of India, from time to time.

(e) Foreign portfolio investment in an Indian Insurance company shall be governed by the provisions contained in Chapter-IV, rule 10 and 11 read with Schedule II of Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, and provisions of the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019.

(f) Any increase in foreign investment in an Indian Insurance company shall be in accordance with the pricing guidelines specified under these rules.

(g) The foreign equity investment cap of hundred per cent. shall apply on the same terms as above to insurance brokers, re-insurance brokers, insurance consultants, corporate agents, third party administrator, Surveyors and Loss Assessors, managing general agents, insurance repositories and such other entities, as may be notified by the Insurance Regulatory and Development Authority of India from time to time.

(h) The Foreign Direct Investment proposals shall be allowed under the Automatic Route subject to verification by the Authority and the foreign investment in insurance intermediaries shall be governed by the same terms as provided under rules 7 and 8 of the Indian Insurance Companies (Foreign Investment) Rules, 2015 :

Provided that where an entity like a bank, whose primary business is outside the insurance area, is allowed by the Insurance Regulatory and Development Authority of India to function as an insurance intermediary, the foreign equity investment caps applicable in that sector shall continue to apply, subject to the condition that the revenues of such entities from their primary (i.e., non-insurance related) business must remain above fifty per cent. of their total revenues in any financial year.

(i) The insurance intermediary that has majority shareholding of foreign investors shall undertake the following:

(i) be incorporated as a limited company under the provisions of the Companies Act, 2013(18 of 2013);

(ii) at least one from among the Chairman of the Board of Directors or the Chief Executive Officer or Principal Officer or Managing Director of the insurance intermediary shall be a resident Indian citizen;

(iii) shall bring in the latest technological, managerial and other skills; and

(iv) shall make disclosures in the formats to be specified by the Authority of all payments made to its group or promoter or subsidiary or interconnected or associate entities;

(j) The other conditions under the heading ‘Banking-Private Sector’ prescribed against Sl. No. F.2.1 shall be applicable in respect of bank promoted insurance companies.

(k) The expressions ‘Equity Share Capital’, ‘Foreign Direct Investment’ (FDI), ‘Foreign Investors’, ‘Foreign Portfolio Investment’, ‘Indian Insurance Company’, ‘Indian Company’, ‘Non-resident Entity’, ‘Resident Indian Citizen’, ‘Total Foreign investment’ shall have the same meaning as provided in the relevant rules notified by the Department of Financial Services under the Insurance Act, 1938(4 of 1938) or in the regulations issued by Insurance Regulatory and Development Authority of India from time to time, in respect of foreign investment in Indian Insurance Companies and Insurance intermediaries.

Foreign investment in LIC shall be subject to compliance with the provisions of the Life Insurance Corporation Act, 1956 (31 of 1956), and such other provisions of the Insurance Act, 1938 (4 of 1938), as are applicable to LIC as per the provisions of section 43 of the Life Insurance Corporation Act, 1956 (31 of 1956).

(b) Provisions of clauses (e) and (f) under Sl. No. F.8.3.1, shall also apply to LIC as if reference therein to an Indian Insurance Company is a reference to LIC.

(c) The expressions referred to in clause (k) under Sl. No. F.8.3.1, shall have the meanings as respectively referred to them therein.

Explanation. – For the purposes of this Sl. No., any reference to Indian insurance company or company referred to in clause (k) under Sl. No. F.8.3.1, shall be construed as a reference to LIC”.