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Consider the following statements:

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Consider the following statements:

A. In India in FY23, the insurance penetration of the non-life insurance sector is more than the life insurance sector.

B. 100% FDI permitted for insurance intermediaries under automatic route.

Which of the following statement/statements is/are correct?

  1. A only

  2. B only

  3. Both A and B

  4. Neither A nor B

1 Answer

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Correct Answer: B only

Explanation:

  1. Statement A:

    • In India in FY23, the insurance penetration of the non-life insurance sector is more than the life insurance sector.
    • Incorrect:
      • Insurance penetration is measured as the percentage of insurance premium to GDP.
      • Historically, in India, the life insurance sector has had a significantly higher penetration compared to the non-life insurance sector. For FY23, this trend continued, with the life insurance sector's penetration being higher than that of the non-life sector.

  2. Statement B:

    • 100% FDI permitted for insurance intermediaries under automatic route.
    • Correct:
      • The Government of India has allowed 100% Foreign Direct Investment (FDI) for insurance intermediaries such as brokers, third-party administrators, surveyors, and loss assessors under the automatic route. This reform was introduced to boost the insurance sector's efficiency and capital inflow.

Conclusion:

  • Statement A is incorrect, while Statement B is correct.
  • Therefore, the correct answer is B only.
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