Parliament has passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025, tightening oversight and consumer protections across India’s insurance sector. The law amends the Insurance Act, 1938, the LIC Act, 1956, and the IRDA Act, 1999, aiming for faster, fairer claims through stronger regulation, better data standards, and digital service upgrades.
Legislative milestone
The new law significantly strengthens regulatory enforcement and supervision, seeking to rebuild trust between policyholders and insurers by improving claims transparency and accountability.
Key provisions
The reforms include allowing up to 100% foreign investment in insurance companies to spur competition and innovation, alongside requirements for highly detailed, verified policyholder records to prevent claim errors and delays.
Sector impact
The changes are expected to translate into improved digital services and faster claims processes, though benefits will depend on implementation by insurers and sustained regulatory follow-through.
Major takeaways
* Bill passed by Parliament on December 17, 2025, tightening sector-wide rules and enforcement
* Amends three core laws: Insurance Act, 1938; LIC Act, 1956; IRDA Act, 1999
* Allows up to 100% FDI to boost competition, product innovation, and service quality
* Mandates detailed, verified customer records to reduce claim errors and processing delays
* Pushes digital upgrades aimed at faster, more transparent claims experiences
Impact
If insurers operationalize stricter data hygiene, disclosures, and grievance redressal under tighter oversight, claim rejections and delays should trend down. Policyholders can help by maintaining accurate disclosures, e‑KYC compliance, and prompt documentation when filing claims.
Sources: India Today, Financial Express, Upstox