Archive · 24 Sep 2026
Irdai Commission Overhaul Pressures PB Fintech and Turtlemint Business Models
India’s insurance regulator wants to change how much insurance sellers can earn.
The proposed rules would put limits on commissions for different kinds of policies.
Online insurance companies such as PB Fintech and Turtlemint could earn less under the plan.
Investors reacted by selling their shares sharply.
Some analysts said PB Fintech’s current business model could be seriously affected.
InsuranceDekho said small motor policies may not generate enough money to cover selling and servicing costs.
The regulator said commissions have risen as insurers compete for access to customers.
Officials also said the Point of Sales Person model is important but should not make insurance distribution too expensive.
Industry representatives warned that removing some commissions could lead to fewer sellers and more uninsured vehicles.
Irdai proposed caps on insurance commissions based on product complexity and selling effort.
Individual life-policy commissions for intermediaries are proposed at 5%-20%, while agent commissions would range from 6.25%-25%.
Health-policy commissions would be capped at 15%-20% for new policies and 5%-10% for renewals or porting.
PB Fintech shares fell 32%, while newly listed Turtlemint hit its 20% lower circuit after the proposal.
Industry representatives warned that lower commissions could weaken distribution networks, especially for low-value motor policies.
- Who
- The Insurance Regulatory and Development Authority of India, PB Fintech, Turtlemint, InsuranceDekho, insurers, agents and other insurance distributors.
- What
- Irdai proposed new caps and structures for insurance commissions, prompting a sharp sell-off in insurance-distribution stocks.
- When
- The consultation paper was launched on Wednesday; Ajay Seth’s comments were made recently, according to the article.
- Where
- India, including the National Stock Exchange where the share-price declines were recorded.
- Why
- Irdai said commission levels should reflect product complexity and selling or servicing effort, while controlling distribution costs.
Regulatory and Cost-Control View
Distributor and Industry View
Commission limits
Regulatory and Cost-Control View
Irdai proposed caps tied to product complexity and the effort needed to sell and service policies, saying rising PoSP remuneration may increase distribution costs.
Distributor and Industry View
Industry participants and analysts said lower commissions could reduce earnings, margins and the viability of existing distribution models.
Motor insurance distribution
Regulatory and Cost-Control View
The proposal would set distributor commissions at zero for motor third-party insurance and 5% for motor own-damage insurance.
Distributor and Industry View
InsuranceDekho argued that low commissions may make small motor policies difficult to distribute and could increase the number of uninsured vehicles.
PoSP network
Regulatory and Cost-Control View
Irdai Chairman Ajay Seth said the PoSP model is integral to insurance but should not become a channel that raises costs.
Distributor and Industry View
Distributors said reduced remuneration may make it harder to retain personnel and sustain customer acquisition and servicing networks.
- Life commissions
- Proposed intermediary commissions on individual life policies: 5%-20%; proposed agent commissions: 6.25%-25%.
- Health commissions
- Proposed distributor commissions: 15%-20% for first-time policies and 5%-10% for renewals or porting.
- Motor third-party
- Proposed distributor commission: zero; agents and associates would be allowed 2.5%.
- Motor own-damage
- Proposed intermediary commission: 5%; agents and associates would be allowed 10%.
- PB Fintech share move
- Shares fell 32% to ₹1,282.30 on the National Stock Exchange, the company’s steepest single-day decline on record.
- Turtlemint share move
- Shares reached the 20% lower circuit at ₹109.04.
- PB Partners network
- PB Fintech’s PoSP vertical has more than 4.5 lakh registered partners and over one lakh active partners.