Foreign insurers are raising their bets on India as regulatory reforms, stronger growth potential, and the prospect of full ownership make the market more attractive than it has been in years.
Reforms such as Indian Accounting Standards (Ind AS), a proposed risk-based capital (RBC) regime, which requires insurers to hold capital in proportion to the risks they underwrite, stronger disclosure norms and improvements in digital public infrastructure are bringing the country's insurance sector closer to global standards, said experts.
"Foreign insurers are already familiar with frameworks like risk-based capital and IFRS (International Financial Reporting Standards), so the market feels more familiar and easier to navigate,” said Narendra Ganpule, partner at professional services firm Grant Thornton Bharat.
Improved disclosures and government-backed digital infrastructure are also changing how insurers assess risk, added Amit Roy, partner and leader for insurance and allied businesses at PwC India.
“We are seeing a positive shift driven by enhanced financial disclosures and robust data availability,” he said.
Initiatives such as the National Health Claims Exchange (NHCX), the National Crop Insurance Portal and wider use of Aadhaar are giving insurers better visibility into risks, helping reduce fraud and improve pricing.
The country has also progressively raised the foreign investment limit in insurance from 26% in 2000 to 49% in 2015, 74% in 2021 and now 100% under the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025, which took effect in February 2026. Though foreign investment in Life Insurance Corporation of India Ltd remains capped at 20%.
Against this evolving regulatory backdrop, and armed with years of experience operating in the country, albeit largely as junior partners, foreign insurers are reassessing long-standing joint ventures, reviving expansion plans and, in some cases, seeking greater control over their Indian operations.
Restructuring partnerships
The latest deals reflect that shift. British insurer Prudential Plc, for instance, is acquiring a 75% stake in Bharti Life Insurance for about ₹3,500 crore, with a conditional payment of up to ₹700 crore, reducing its holding from about 22% to under 10% in ICICI Prudential Life Insurance, which will also see it cease to be a promoter.
German player Allianz SE exited its two-decade partnership with the Bajaj Group in January, selling its 26% stake in the life and general insurance ventures for about €2.6 billion, before announcing a 50:50 general and health insurance venture with Jio Financial Services Ltd.
London-based Aviva Plc has agreed to buy Dabur India Ltd's stake to raise its ownership to 100% in their joint venture, while Sydney-based QBE Insurance Group Ltd has taken full ownership of Raheja QBE General Insurance Co. Ltd, buying out Indian partner Prism Johnson's 51% stake for about ₹324 crore, moving from 49% to 100%.
Other overseas insurers, including Zurich-based Chubb and Cape Town-based Old Mutual Ltd, as well as American investment firms such as Tiger Global Management LLC and Bain Capital LP, are also evaluating opportunities in the country.
Mint reported on 12 June that New York-based MetLife Inc. is also seeking majority control of PNB MetLife India Insurance Co. Ltd, in which it currently holds 49.73%.
To be sure, most of these partnerships were formed almost two decades ago under very different market conditions.
“When many joint ventures were formed, partners agreed on who would control specific functions,” said Shubhra Goel, managing director at professional services firm Alvarez & Marsal.
“Over time, those arrangements evolved, responsibilities shifted, and the original governance structure weakened. If the shareholding didn't reflect those changes, partners could no longer influence decisions as they had expected.”
The fault lines were often strategic rather than structural. Foreign insurers typically prioritized underwriting discipline, pricing and profitability, while their Indian partners focused on growth and distribution. Capital commitments also emerged as a point of friction, with overseas partners often more willing to invest than their Indian counterparts.
“One partner may want faster growth, while the other prioritizes margins and profitability,” Goel said.
Distribution remains a deciding factor, particularly in life and health insurance, where reaching customers at scale can take years.
“If a foreign insurer starts greenfield without its own distribution, what does it do on day one?” said Ganpule. “Without a distributor as a JV partner, building distribution from scratch takes years.”
That is why many foreign insurers prefer to acquire or partner with existing businesses rather than build one from scratch. “The fact that 100% ownership has been allowed for nearly a year and foreign insurers haven't rushed in tells you ownership alone isn't enough without distribution,” Ganpule said.
Mint's queries emailed to the insurers remained unanswered.
Opportunities vs trade-offs
India's underpenetrated insurance market and improving regulatory framework continue to offer significant long-term growth opportunities, particularly in non-life and health insurance, said Shruti Ladwa, partner and insurance leader at EY India.
The country collected about ₹11.9 trillion in insurance premiums in 2024-25, up from ₹11.2 trillion a year ago, according to the Insurance Regulatory and Development Authority's annual report.
Swiss reinsurance company Swiss Re expects the country to be the fastest-growing major insurance market between 2026 and 2030. Yet insurance penetration stood at just 3.7% of gross domestic product in FY25, well below the global average of about 7%.
Unlike life insurance, which depends heavily on agency and bancassurance networks, non-life and health insurance rely more on underwriting expertise and technology.
Commercial insurance also offers opportunities, though it remains a relatively small segment, accounting for 17-18% of India's non-life market, Goel said.
Experts, however, cautioned that attracting foreign investment will depend on more than liberalizing ownership rules. “What India needs to still work on is the ease of doing business,” said Ganpule.
He added that the country must also compete with other markets for global capital. “The first decision is whether to invest in India at all. Within Asia, there are several attractive markets, such as Malaysia, Thailand and Indonesia. Investors first compare countries based on expected return on equity, and some markets may offer better returns than India.”