Insurance stocks: Shares of several insurance companies, including Life Insurance Corporation of India, SBI Life Insurance, Star Health and Allied Insurance Company, declined up to 2% in Monday’s trading session (November 24) amid reports that the government is likely to table a bill on open architecture for individual agents in the upcoming winter session of the Parliament.
The changes will likely be part of the Insurance Amendment Bill, already listed for introduction, consideration and passing. Through the legislation, the government aims to deepen penetration and accelerate growth in the sector, the parliament document said.
The Winter Session of Parliament is scheduled to be held from December 1 to December 19, 2025, with a total of 15 sittings.
According to a CNBC TV-18 report, the government may introduce open architecture rules for insurance agents, which would allow insurance agents to sell products from multiple companies instead of just one, giving customers more choices.
What is open architecture?
Right now, many individual insurance agents can sell products for only one insurance company. However, if the new law is introduced, it would allow agents to work with multiple insurance companies.
This means an agent could sell policies from several companies rather than being tied to just one.
Insurance companies oppose the move
However, as per the CNBC TV-18 report, several companies have expressed their qualms with such a move, with LIC and SBI Life reportedly requesting the government to reconsider the open architecture for individuals.
This is because in H1 FY26, 92% of new business premiums for LIC came through agents, highlighting how important agents are to sales. Companies fear that such a move could probably reduce their exclusive control over their agents.
Additionally, in the Union Budget 2025–26, the government proposed removing limits on foreign direct investment in the insurance sector, from the current 74%. This could also be part of the bill being tabled next month.
Insurance stocks fall up to 2%
Against this backdrop, several insurance stocks faced some selling pressure despite the Indian stock market trading marginally higher.
LIC share price dipped 1.5% to ₹888.30 on the BSE, while Star Health and Insurance Company fell 2% to ₹481.30. PSU stock SBI Life was, meanwhile, down 0.7% at ₹2007.55.
Max Financial, HDFC Life, ICICI Lombard and Niva Bupa were among other insurance stocks that traded with cuts today.
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