The authority, with a view to examining the issue of FDI in insurance intermediaries and TPAs (third party administrator) and to recommend further course of action in this regard, constitutes the committee, Irda said in an official release.
The terms of reference of the committee include whether there is a case for increasing FDI limit in case of insurance entities (other than insurance companies), the implication of modifying the limit on the industry and any other relevant issue.
The committee would also examine as to how much extent, if possible, the FDI limit can be increased in intermediaries and study the international practices in this regard. The ten-member committee, to be headed by Irda senior joint director Suresh Mathur, will have officials from the regulator, insurance council, insurance companies as well as brokers.
As per the existing norms, the aggregate shareholding of a foreign company cannot exceed 26% in an insurance company. No such stipulation limits the foreign shareholding in cases of insurance intermediaries. However, Irda, keeping in mind that the insurance industry is in nascent stage, has limited the holdings of a foreign firm to 26% in the case of brokers and TPAs.