Private insurers demand for raising FDI ceiling to 49%

Meeting Finance Minister Arun Jaitley, who is keen to push insurance sector reforms, the private insurers demanded raising FDI limit to 49 per cent from 26 per cent now. This measure would benefit the industry to get the much needed capital to enhance their businesses, they said."We are talking...It is pre-budget discussion," Minister of State for Finance Nirmala Sitharaman, who was also present at the hour-long meeting, said.She was responding to a query whether industry was opposed to capping voting right at 26 percent in case FDI limit is raised to 49 percent in the sector.ICICI Lombard General Insurance MD and CEO Bhargav Dasgupta said, "We discussed various aspects, including increasing penetration. Again there was lot of discussion on FDI in insurance but nothing concrete... But discussion was how to attract more capital in industry and promote growth".Even IRDA Chairman T S Vijayan said there were deliberations on the various issues of insurance industry.Besides, industry also pitched for raising tax break limit for the sector for encouraging investment, he said, adding, there were suggestions of raising tax exemption limit from the existing Rs 15,000 per year.In order to increase insurance penetration, some of the participants suggested allowing banks to act broker. At present, banks are permitted to act as a corporate agent and sell policy of one life insurer, non-life insurance and one health insurance company.The insurance sector was opened up to the private sector in 2000 after the enactment of the Insurance Regulatory and Development Authority Act, 1999.