As a largest democracy India is no doubt a developing economic ecology and many economistsconsider it an attractive hotspot for financially inclusion, in particular generalization specially for rapidly growing and changing insurance market spatial space. Indian insurance industry is one of the sunrise sectors with huge growth potential. Foreign direct investment pivotedadeceivefunctionalistic role in the economic development of the country. However, Foreign Direct Investment (FDI) is injected in the insurance spatial space, and despite many years of regressive prejudice, the correlated regulations are still not paradigm shifted and there are still lots of pre-requisites. Foreign Investors are interpreted India, ready for a piece of the action in the insurance market, but there are still plethora of uncertainties, restrictions and potential socio-economic risks. However, the Government is gradually taking steps to liberalise the sector. Due to economic liberalization initiated few years ago have evitable bringing in new investments from global giants and the government was hard to hypothetical generalized the facilitate global integration by assimilatingtrade retrospections for the free diffusion of technology, intellectual and financial imperialism. Thus liberalization of insurance creates an environment for the generation of long term contractual funds for infrastructural investments. This research paper’s objectives are to investigate the Indian insurance industry and review present policy regulations with a ideological perspective of foreign institutional investors so as to gain an understanding of the current position on FDI, as well as an overview of the Indian Policy and Regulatory Environment.