The Indian Parliament passed the Sabka Bima Sabki Raksha Act 2025 on December 17, 2025, and it received presidential notification on December 22, 2025. This landmark legislation represents the most sweeping reform of India's insurance sector since liberalisation, raising the Foreign Direct Investment (FDI) cap in insurance from 74% to 100%.\n\nThe Act amends three foundational statutes: the Insurance Act of 1938, the Life Insurance Corporation (LIC) Act of 1956, and the Insurance Regulatory and Development Authority (IRDAI) Act of 1999. By doing so, it comprehensively modernises the legal framework governing India's insurance industry, which has a total premium market of over ₹11 lakh crore.\n\nOne of the most significant innovations is the creation of the Policyholders Education and Protection Fund (PEPF), a dedicated corpus to safeguard the interests of insurance customers, enhance financial literacy among policyholders, and provide a structured mechanism for grievance redressal. This fund institutionalises consumer protection within the insurance ecosystem.\n\nThe 100% FDI liberalisation is expected to attract major global insurance conglomerates to India, bringing in capital, international best practices, advanced actuarial expertise, and innovative product offerings. Experts project this could accelerate India's insurance penetration, which stands at approximately 4% of GDP — well below the global average of 7%.\n\nThe Act is part of the broader 'Bima Trinity' initiative — comprising Bima Vistaar (comprehensive rural micro-insurance), Bima Vaahak (women-led insurance distribution), and Bima Sugam (integrated insurance marketplace) — positioning insurance as a pillar of India's financial inclusion mission.