Impact of Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025 in Insurance Sector in India: An Empirical Study

Abstract

This paper reviews the landscape of the insurance industry in India which is slated to grow exponentially in the next decade because of the enormous size of the population coupled with the fact of under-penetration of insurance in India. However, the technological revolution, from big data to blockchain; from industry 4.0 to artificial intelligence have all reshaped the insurance sector in the last decade. This has resulted in need for reforms to facilitate massive capital and latest technology in insurance sector. In Indian Budget 2025, Govt. announced 100% FDI in Insurance and subsequently came up with Insurance Amendment Rules in August 2025 and finally passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025 with a slew of changes. It entails insurance for all by 2047 and involves changes in multiple acts pertaining to the insurance industry in India including the Insurance Act, 1938, Life Insurance Corporation Act, 1956 and Insurance Regulatory and Development Authority of India Act, 1999. To analyze the impact of these reforms, I used over 150 survey responses from employees and managers, insurance agents and policyholders to measure awareness of these reforms, their perceived enforcement and implementation and to showcase their relationship with perceived transparency. Applying various statistical and econometric tools, I find both awareness of stakeholders and effective reforms implementation significantly predict transparency positively along with showcasing strongest effect through implementation. Awareness partially mediates the effect of implementation on transparency-based outcomes. A tool transparency index evaluates its utility as a major policy tool. The research has important implications for regulators, insurance companies, policymakers and other stakeholders alike.