India’s Finance Ministry has proposed that the government issue a single licence for all kinds of insurance. If approved, this licence will apply to both new and existing insurance companies.
The new composite licence will give insurers access to any line of business in the market, Moneycontrol reported. Licenced insurers can do business in any segment – life, health, and general – including subclasses such as motor and accident.
The issuing of composite licences could speed up the entry of new firms in India’s insurance industry, driving competition and innovation.
The Insurance Regulatory and Development Authority of India (IRDAI) said that it is in favour of issuing composite licences for the industry’s players. It also recently called for the relaxation of minimum capital requirements for insurers.
IRDAI chairman Debasish Panda said that, until recently, the last time an approval for a new insurance company was granted was in 2017. This was broken by the approval of Kshema General Insurance, while another company, which Panda did not reveal, is set to receive its licence. Approvals for many more insurance companies are also being readied.
“We hope in the next board [meeting] it should also get cleared, and 18 more are in the pipeline,” Panda said.