LIC, Niva Bupa to ICICI Lombard: Insurance stocks gain on Lok Sabha nod to Insurance Amendment Bill

Insurance stocks: Shares of Life Insurance Corporation of India, SBI Life, ICICI Lombard General Insurance, and other Indian insurance companies traded in the green in the early morning session on Wednesday, December 17, after the Lok Sabha approved the Insurance Laws Amendment Bill.

Shares of India's biggest insurance company, LIC of India, gained 0.65%. LIC share price hit the day's high of ₹859.95 on the BSE. Meanwhile, ICICI group companies — ICICI Lombard General Insurance and ICICI Prudential Life Insurance — gained over 1% each.

ICICI Lombard General Insurance was the best-performing insurance stock in the morning session, rising 1.47% to ₹1978.65. Meanwhile, ICICI Prudential Life Insurance was higher by 1.02% at ₹643.25.

Niva Bupa Health Insurance, SBI Life Insurance, Max Financial Services, and Star Health Insurance also eked out some gains. However, stocks like Go Digit, HDFC Life and Canara HSBC Life Insurance traded with some cuts.

Insurance Amendment Bill: Key contours & impact

The Insurance Amendment Bill, introduced by Finance Minister Nirmala Sitharaman and passed by the Lok Sabha, included:

1. 100% foreign direct investment (FDI) in insurance,
2. significant reduction in initial capital requirement for re-insurers,
3. merger between insurance and non-insurance entities,
4. increase in approval thresholds for stake sale in insurers,
5. empowering the insurance regulator to regulate distribution commission payouts,
6. operational flexibility for LICI, and
7. creation of a reserve fund by LICI.

Hanut Mehta, CEO and Co-Founder at BimaPay Finsure, said the Insurance Bill is a structural step that can meaningfully reshape India’s insurance ecosystem. “Higher foreign participation is likely to bring in long-term capital, global underwriting expertise, and improved product innovation, all of which can support deeper insurance penetration across segments.”

Overall, the amendment has the potential to create a more competitive and well-capitalised insurance market, he noted.

Domestic brokerage HDFC Securities said that it believes these proposed amendments, coupled with recent GST rate rationalisation, shall drive improved insurance penetration and awareness with the streamlining of regulations.

“We believe stabilisation of government policies and minimal regulatory interventions would be the key monitorable for re-rating of the insurance sector,” said the brokerage.

Its top picks across life/general/standalone health insurers are SBI Life, ICICI General Insurance and Niva Bupa. Meanwhile, it also likes Policy Bazaar as a platform play for the insurance ecosystem.

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.