**Executive Summary**
The document is The Insurance (Amendment) Act, 2021, Act No. 6 of 2021. It received the assent of the President on March 25, 2021, and amends the Insurance Act of 1938. The Act's effective date will be determined by the Central Government via notification in the Official Gazette.
**Key Points / Main Content**
* **Short Title and Commencement**
* The Act is called The Insurance (Amendment) Act, 2021.
* It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.
* **Amendments to the Insurance Act, 1938**
* **Section 2, clause (7A):** Foreign investment in Indian insurance companies, including holdings of equity shares by portfolio investors, can't exceed 74% of the paid-up equity capital, subject to prescribed conditions and manners.
* **Section 27, sub-section (7):** The Explanation shall be omitted.
* **Section 114, sub-section (2):** For clause (aaa), the following clause shall be substituted, namely:—
* "(aaa) the conditions and manner of foreign investment under sub-clause (b) of clause (7A) of section 2;"
**Impact Analysis**
**Central Government**
* **Impact:** Responsible for determining the effective date of the Amendment Act.
* **Action Required:** To issue a notification in the Official Gazette specifying the date on which the Act will come into force.
**Indian Insurance Companies**
* **Impact:** Subject to the revised regulations regarding foreign investment limits.
* **Action Required:** Ensure compliance with the new limit of 74% on aggregate holdings of equity shares by foreign investors, including portfolio investors.
**Foreign Investors (including Portfolio Investors)**
* **Impact:** Impacted by the revised limit on equity share holdings in Indian insurance companies.
* **Action Required:** Monitor and adjust their equity share holdings to remain within the 74% limit, adhering to conditions and manners as prescribed.
Key Entities Referenced
The Insurance (Amendment) Act, 2021: An act further to amend the Insurance Act, 1938, focusing on increasing the permissible foreign investment in Indian insurance companies.
Insurance Act, 1938: The principal act being amended by the Insurance (Amendment) Act, 2021, especially concerning foreign investment regulations.
Ministry of Law and Justice (Legislative Department): The ministry responsible for publishing the Insurance (Amendment) Act, 2021.
jftLVªh lañ Mhñ ,yñ—(,u)04@0007@2003—21
REGISTERED NO. DL—(N)04/0007/2003—21
1
सी.जी.-डी.xएxलx.G-अI.D-2H60x3x2x021-226127
CG-DL-E-26032021-226127
xxxGIDExxx
vlk/kkj.k
EXTRAORDINARY
Hkkx [k.M
II — 1
PART II—Section 1
izkf/kdkj ls izdkf'kr
PUBLISHED BY AUTHORITY
lañ ubZ fnYyh] c`gLifrokj] ekpZ 25] 2021@pS= 4] 1943 ¼'kd½
8]
No. 8] NEW DELHI, THURSDAY, MARCH 25, 2021/CHAITRA 4, 1943 (SAKA)
bl Hkkx esa fHkUu i`"B la[;k nh tkrh gS ftlls fd ;g vyx ladyu ds :i esa j[kk tk ldsA
Separate paging is given to this Part in order that it may be filed as a separate compilation.
MINISTRY OF LAW AND JUSTICE
(Legislative Department)
New Delhi, the 25th March, 2021/Chaitra 4, 1943 (Saka)
The following Act of Parliament received the assent of the President on the
25th March, 2021, and is hereby published for general information:—
THE INSURANCE (AMENDMENT) ACT, 2021
NO. 6 OF 2021
[25th March, 2021.]
An Act further to amend the Insurance Act, 1938.
BE it enacted by Parliament in the Seventy-second Year of the Republic of India
as follows:—
1. (1) This Act may be called the Insurance (Amendment) Act, 2021. Short title and
commencement.
(2) It shall come into force on such date as the Central Government may, by notification
in the Official Gazette, appoint.
4 of 1938. 2. In the Insurance Act, 1938 (hereinafter referred to as the principal Act), in section 2, Amendment
in clause (7A), for sub-clause (b), the following sub-clause shall be substituted, namely:— of section 2.
"(b) in which the aggregate holdings of equity shares by foreign investors
including portfolio investors, do not exceed seventy-four per cent. of the paid-up
equity capital of such Indian insurance company, and the foreign investment in which
shall be subject to such conditions and manner, as may be prescribed;".2 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—SEC. 1]
Amendment 3. In section 27 of the principal Act, in sub-section (7), the Explanation shall be
of section 27. omitted.
Amendment of 4. In section 114 of the principal Act, in sub-section (2), for clause (aaa), the following
section 114. clause shall be substituted, namely:—
"(aaa) the conditions and manner of foreign investment under sub-clause (b) of
clause (7A) of section 2;".
————
DR. G. NARAYANA RAJU,
Secretary to the Govt. of India.
UPLOADED BY THE MANAGER, GOVERNMENT OF INDIA PRESS, MINTO ROAD, NEW DELHI–110002
AND PUBLISHED BY THE CONTROLLER OF PUBLICATIONS, DELHI–110054.
MGIPMRND—1785GI(S3)—25-03-2021.