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Abstract
One of the most striking developments during the last two decades is the spectacular growth of FDI in the global economy landscape. This unprecedented growth of FDI in 1990 around the world make FDI an important and vital component of development strategy in both developed and developing nations and policies are design in order to stimulate inward flows. FDI provides a win-win situation to the host and the home countries. Both countries are directly interested in inviting FDI, because they benefit a lot from such type of investment. Generally speaking FDI refers to capital inflows from abroad that invest in the production capacity of the economy and are usually preferred over other form of external finance because they are non-debt creating non-volatile and their returns depend on the performance of the projects financed by the investors. FDI inflow helps the developing countries to developed transparent, broad and effective policy environment for investment issues as well as, builds human and institutional capacities to execute the same. The insurance sector is of considerable importance to every developing economy; in includes the saving habit, which in turn generates long-term investible funds for infrastructure building. This Paper’s objectives are to investigate the Indian Insurance sector, to know benefits of increased foreign direct investment limit in insurance sector, to know the Government policy regarding insurance sector in India, to know Issues in FDI in Insurance Sector.