Mutual Funds and Insurance — Policy Reforms

Entry	Year	Description	Impact
SEBI (Mutual Funds) (Amendment) Regulations	2024	These amendments aim to further strengthen the regulatory framework for mutual funds, focusing on enhanced investor protection, risk management, and transparency. Key areas include stricter norms for valuation, disclosure of ESG (Environmental, Social, and Governance) investments, cybersecurity protocols, and potentially revised guidelines for 'skin in the game' for fund managers.	Expected to lead to greater accountability of AMCs, more robust risk management practices, and increased transparency in ESG fund offerings. This will enhance investor confidence and streamline operations, aligning Indian mutual fund regulations with global best practices.
Insurance Laws (Amendment) Act	2015	This landmark amendment significantly reformed the Indian insurance sector. It increased the Foreign Direct Investment (FDI) limit in insurance companies from 26% to 49% (later further raised to 74% in 2021). It also introduced specific provisions for microinsurance, health insurance, and enhanced penalties for various violations, while strengthening the powers of IRDAI.	The increased FDI limit brought in much-needed capital, technology, and global expertise, fostering competition and product innovation. Provisions for microinsurance and health insurance aimed at expanding coverage to underserved populations, boosting insurance penetration and financial inclusion across India.
IRDAI (Payment of Commission) Regulations	2023	These regulations rationalized the commission structure for insurance agents and intermediaries. They moved towards a principle-based regime, allowing insurers greater flexibility in designing commission structures while ensuring overall expenses remain within limits, aiming to reduce mis-selling and promote long-term policyholder value.	Aims to reduce the incentive for mis-selling high-commission products and encourage agents to focus on policyholder needs. It could potentially lead to more competitive pricing of insurance products and improve the persistency of policies, benefiting policyholders in the long run.