Govt Likely to Relax Board Norms for Foreign Insurers

May Allow Majority Non-Resident Boards Once FDI Cap Is Raised to 100%

- HARSH KUMAR

The Union government is likely to allow foreign insurers to appoint a majority of non-resident board members, along with other key managerial personnel (KMPs), once the foreign direct investment (FDI) cap is raised to 100 percent from the current 74 percent, two senior government officials have confirmed.

This is a key demand from the US government and American insurance industry groups, with both the United States Trade Representative (USTR) and the Coalition of Services Industry (CSI) recently raising the issue.

"The insurance Bill is ready from our end and is likely to be introduced in the upcoming Monsoon Session. We plan to ease provisions related to the appointment of directors. We have no objection if a US national or any foreign professional takes on a leadership role," said a senior government official. "Foreign insurance companies are already fully regulated by Irdai (Insurance Regulatory and Development Authority of India), and these changes will not result in any major structural or operational overhaul."

The official stressed that while the reforms are not intended to open the floodgates to foreign control, they signal a more welcoming approach to global participation in leadership roles.