IRDAI proposes insurance distribution overhaul, seeks feedback until Oct 25
Big news: the Insurance Regulatory and Development Authority of India (IRDAI) is planning a major revamp of the way insurance gets distributed.
The goal? Make things more transparent, lower the barriers for new players, and streamline how policies reach people.
They're suggesting new categories for distributors, easier entry rules, and tighter company-level spending limits.
Stakeholders can share their thoughts on these ideas until October 25, 2026.
Proposed caps and 3 distributor categories
If these changes go through, insurers will have clearer spending caps (12.5% of gross direct premium income (GDPI) for life insurers and 20% of GDPI for general insurers within five years).
Distributors would be grouped into three broad distributor categories, hopefully making things simpler for everyone.
But there are concerns: some worry that lower commissions could mean less support when you actually need help with claims or that fewer people might bother selling certain insurance products at all.
On the plus side, IRDAI also wants better commission disclosures and more digital access to protect consumers and keep companies accountable.