Archive · 6 Oct 2026
Insurance Brokers Seek More Time on Proposed Commission Caps
India’s insurance regulator has proposed new limits on the commissions paid to people and businesses that sell insurance.
A brokers’ association says it needs more time to study the plan and wants to send its comments by December.
Brokers say the rules treat different kinds of insurance sellers too much alike.
They also want a gradual change, rather than having to adjust quickly.
The association warns that smaller brokerages and jobs could be affected.
It says small businesses and customers in smaller cities might also find it harder to get help buying insurance.
The brokers are unsure whether lower commissions would lead to lower prices for customers.
The regulator’s proposed rules are planned to take effect in April 2027.
The Insurance Brokers Association of India will meet Irdai on Friday to request more time to assess proposed distribution-rule changes.
The association plans to submit its feedback by December, rather than the current 25 October deadline.
Irdai’s draft proposes first-year commission caps of 5%–20% for distribution entities and 6.25%–25% for agents.
Brokers object to grouping agents with brokers and independent advisers, and are asking for a phased transition.
The association warns the changes could threaten jobs, smaller brokerages and insurance access for MSMEs, while questioning whether savings would lower premiums.
- Who
- The Insurance Brokers Association of India and the Insurance Regulatory and Development Authority of India (Irdai).
- What
- The brokers’ association plans to seek more time to comment on proposed insurance distribution rules and commission caps.
- When
- The association will meet Irdai on Friday; it proposes submitting feedback by December instead of 25 October. Irdai plans final norms by April 2027.
- Where
- Mumbai.
- Why
- The association says it needs time to assess the changes and is concerned about broker identity, the impact on smaller businesses and jobs, and whether savings would benefit policyholders.
Brokers’ concerns
Irdai’s proposed framework
How insurance sellers are grouped
Brokers’ concerns
The IBAI says agents, brokers and independent advisers have different roles, and that grouping them could blur the identity and responsibilities of neutral intermediaries.
Irdai’s proposed framework
Irdai’s consultation paper proposes a distribution architecture that applies commission caps to distribution entities and agents; the article does not state the regulator’s response to the association’s objection.
Transition to new rules
Brokers’ concerns
The IBAI supports reform but wants brokers to receive a phased transition, similar to the glide path proposed for insurers.
Irdai’s proposed framework
Irdai’s draft proposes commission caps and a five-year glide path for insurers’ overall expenses of management; the article does not specify a comparable transition for brokers.
Who benefits from lower costs
Brokers’ concerns
The IBAI questions whether reduced distribution costs would lower premiums, arguing that savings need a measurable route to policyholders.
Irdai’s proposed framework
The consultation paper proposes limits on commissions and insurer expenses; the article does not state how Irdai expects any savings to reach customers.
- Consultation paper released
- 23 September 2026
- Current feedback deadline
- 25 October
- IBAI's proposed feedback timing
- December
- Proposed first-year commission cap for distribution entities
- 5%–20%
- Proposed first-year commission cap for agents
- 6.25%–25%
- Planned implementation of final norms
- April 2027
- Employment impact claimed by IBAI
- At least 1 million distribution livelihoods could be at risk over the proposed five-year glide path.