"The passage of Insurance Amendment Bill in Rajya Sabha marks a new beginning for the Indian insurance sector," FICCI Director General Arbind Prasad said.
"A much awaited legislation will pave way for higher investments and more innovation in the insurance domain in India," he added.
Prasad said the growth of insurance sector would help bring much needed funds for meeting India's growth aspirations.
Industry body CII said the passage of the Bill would have "multiplier effect on the state of economy".
"The long awaited reform will help create a conducive environment for reviving investments and sustaining growth in the Indian insurance industry," CII said.
CII Director General Chandrajit Banerjee said that the further capital infusion in the insurance sector, through greater FDI, would ensure innovations on product design and distribution, better risk management, introducing superior technology and greater investments.
Assocham President Rana Kapoor said the support of opposition parties for the Insurance Bill augurs well for reforms. He hoped that the same spirit and cooperation is extended for Coal and Land Acquisition Bill.
Parliament tonight approved the NDA government's first major economic reform measure as the long-pending bill providing for raising foreign investment cap to 49 percent in insurance was passed by Rajya Sabha after main opposition Congress and some other parties came on board.
The controversial Insurance Laws (Amendment) Bill, 2015, which replaced an ordinance promulgated in December last, was passed by voice vote after walkout by Trinamool Congress and DMK.