Research Icon - Insurance stocks gain 2-8% on report of likely increase in FDI limit

Share prices of insurance companies rallied 2-8 percent in the morning trade on December 10 after a media report said that the government may raise the foreign direct investment (FDI) limit in the sector.

HDFC Life Insurance Company, SBI Life Insurance Company and ICICI Prudential Life Insurance Company gained more than 2 percent each, while General Insurance Corporation of India climbed 4 percent and New India Assurance Company rose 7.8 percent.

"The government may raise the overseas investment limit in insurance to 74 percent in the February budget, up from 49 percent now, possibly paving the way for foreign control of companies," The Economic Times quoted people with knowledge of the matter as saying.

The government had in September increased the FDI limit in insurance intermediaries to 100 percent.

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