In February 2015, when the Insurance Laws (Amendment) Act was passed, the cap on foreign ownership of Indian insurers was raised from 26 per cent to 49 per cent. This, it was widely believed, would open the sluice gates for foreign investment in the capital-starved sector. However, a new term in the rule book, "Indian management control", began to haunt the industry.
With no clarity on what this meant, the industry was understandably apprehensive. The FDI limit change was meant to be a game changer. But doubts persisted over control and Indian management. Some interpreted it as no foreigner being allowed to be a part of an insurer's top management, while others saw it curtailing their voting rights.
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