The Parliament on Monday passed a bill to increase the foreign direct investment (FDI) limit in the insurance sector to 74 per cent from 49 per cent.

Piloting the Bill, finance minister Nirmala Sitharaman said the insurance sector faces a solvency ratio issue and the increase in the FDI limit would help them raise additional funds.

“If growth capital is hard to come by, there will be a stress situation. In order that the stress situation is not left unattended, we need to raise the FDI limit,” she said.