New laws to usher in insurance reforms

The government plans to introduce legislation during Parliament’s monsoon session to implement comprehensive reforms, including provisions for a composite insurance licence, relaxed entry barriers for companies, and simplified investment rules, in the insurance sector, two people aware of the development said.

In the monsoon session, the Centre is expected to introduce two pieces of legislation—the Insurance Laws (Amendment) Bill, 2023, and the Insurance Bill, 2023. The first legislation would be aimed at reforms to boost insurance penetration, improve efficiency, and enable product innovations. The Insurance Bill, 2023, on the other hand, is being drafted to simplify and update the legal framework governing the sector. It entails the repeal and re-enactment of the Insurance Act, 1938, aiming to simplify pre-constitutional enactments by renumbering and eliminating obsolete British-era provisions.