The Sabka Bima Sabki Raksha Insurance Bill: The 2047 Vision in action
– Vinita Nair and Saloni Khant | corplaw@vinodkothari.com
– Updated on February 12, 2025
Being the 10th largest[1] in the world, the Indian Insurance market grows at 10-15% annually but insurance penetration is only at 3.7% of the GDP[2] as against the global average of 7.3%. With a view to boost growth in the sector and implement the vision of ‘”Insurance for All by 2047’, amendments in the existing insurance laws were placed before the public for consultation in November, 2024. Following the due process of legislation, the draft bill underwent several changes, was passed by both the houses of the parliament, assented to by the president and finally notified in the Official Gazette as the Sabka Bima Sabki Raksha (Amendment Of Insurance Laws) Act, 2025 (“Amendment Act”) on December 21, 2025. The Amendment Act, that amends the Insurance Act, 1938, Life Insurance Corporation Act, 1956 and Insurance Regulatory and Development Authority Act, 1999, introduces fundamental reforms by liberalising foreign investments and reducing capital requirements but at the same time, strengthens regulatory oversight on the market participants with additional measures to protect the interest of the policyholders.
The Amendment Act became effective from February 5, 2026. The amendment relating to prohibition on common MD and officers among insurance companies, banking companies and investment companies (Section 32A of the Insurance Act), has not been made effective, in view of industry representation made to IRDA, refer the discussion below.
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