Archive · 23 Sep 2026
Hospitals and Garages May Sell Insurance Under Proposed Reforms
India’s insurance regulator is considering new rules for who can sell insurance.
Hospitals might be allowed to sell health insurance after registering under a new category.
Some automobile repair garages might also sell motor insurance.
These businesses would have to follow training and customer-protection rules.
They would need to offer policies that fit customers’ needs, not simply policies paying higher commissions.
The regulator is also considering limits on commissions.
It says motor insurance commissions rose much faster than motor insurance premiums.
The proposals are meant to make insurance distribution simpler, more competitive and more transparent.
India’s insurance regulator has proposed allowing hospitals to distribute health insurance as registered Insurance Distribution Entities.
Non-dealer automobile garages could sell motor insurance by becoming associates of an insurer.
The proposal would simplify insurance distribution through a common, activity-based regulatory framework.
Distributors would need to meet training, certification, customer-information and product-suitability requirements.
The regulator cited rising commissions, including a 259% increase in motor commissions between FY23 and FY25, as a reason for reform.
- Who
- The Insurance Regulatory and Development Authority of India, hospitals, automobile garages and insurance distributors.
- What
- A consultation proposal would allow hospitals to distribute health insurance and non-dealer repair garages to sell motor insurance, alongside broader distribution reforms.
- When
- The proposal follows commission and premium changes reported for FY23 to FY25; the article does not specify a final implementation date.
- Where
- India.
- Why
- The proposed reforms aim to expand distribution, improve consumer outcomes, strengthen competition, simplify regulation and control rising distribution costs and commissions.
- Regulator
- Insurance Regulatory and Development Authority of India (IRDAI)
- Hospital role
- Hospitals could distribute health insurance after registering as Insurance Distribution Entities.
- Garage role
- Non-dealer automobile garages providing repair services could sell motor insurance as insurer associates.
- Motor commission rate
- Average motor insurance commission was reported at 24%, ranging from 13% to 50%.
- Motor distribution channels
- OEM brokers and Motor Insurance Service Providers held a 30% share of the combined new- and old-vehicle market.
- FY25 commissions
- These motor distribution channels generated ₹29,000 crore in premiums and received almost ₹7,050 crore in commissions.
- Growth comparison
- Motor insurance premiums grew about 34% between FY23 and FY25, while motor commissions grew about 259%.