Insurance stocks: Union Finance Minister Nirmala Sitharaman announced a gamechanger about the insurance sector in the budget today. He has completely opened the insurance sector of the country to foreign investors and now 100 % FDI can come in this sector. Earlier this limit was 74 percent. Due to this, Insurance sector legendary companies LIC (LIC), HDFC Life, New India Assurance, SBI Life, SBI Life, ICICI Prudential Life and Star Health The shares jumped up to three percent.
Only these investors will get the benefit of 100% FDI rule
Finance Minister Nirmala Sitharaman announced to increase the FDI limit from 74 per cent to 100 per cent in the insurance sector. However, he further said that this increased limit will be applicable to investors who will invest their entire premium in India.
Moody’s counted this advantage
On the announcement of the Finance Minister, Moody’s Ratings said that the profit margin would be better due to the increase in FDI limit in the insurance sector. There will be heavy capital in this sector and financial reserve will be strengthened. Apart from this, more companies of this sector can be listed in the market. Insurance companies were already hoping that the FDI limit could be increased. The government had earlier proposed a change in the Insurance Act, 1938 to increase this limit, but now the Finance Minister finally announced it.
Now the insurance sector is waiting for these reliefs
Axis Securities had suggested to reduce GST rates on these to make health and term insurance before the budget. Apart from this, the brokerage firm also suggested to increase tax exhalation limit to encourage purchases of insurance policy. Now, if they are not discussed in the budget, then the wait on them has become longer. However, the Finance Minister has said that if a new income tax bill will be introduced next week, then the analysts will be eyeing whether there is any change in the tax execution limit or not.
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