Archive · 28 Sep 2026
IRDAI Plans Claims, Grievance and Product Reforms After Distribution Overhaul
India’s insurance regulator is planning several new changes.
These changes will cover how claims are handled, how customer complaints are resolved and how insurance products are designed.
The regulator has already proposed changes to how insurance is sold.
These proposals could limit some expenses and commissions paid to distributors.
They would also require more disclosure and could recover money when mis-selling occurs.
IRDAI Chairman Ajay Seth said the goal is to make insurance more efficient and trustworthy.
He said insurers should pass savings on to customers.
The distribution changes might begin in January or April 2027, but more consultations must happen first.
IRDAI Chairman Ajay Seth said reforms covering claims, grievances and products are planned for the next financial year.
The proposed distribution reforms include lower expense limits, product-linked commission caps and greater disclosure of distributor remuneration.
The consultation paper also proposes clawbacks when distributors are found to have mis-sold insurance products.
The distribution framework could take effect on January 1 or April 1, 2027, after further consultations.
IRDAI expects insurers to pass cost savings to policyholders through lower premiums, improved returns or better claim ratios.
- Who
- The Insurance Regulatory and Development Authority of India and its chairman, Ajay Seth.
- What
- IRDAI is preparing reforms for claims management, grievance redressal and insurance products, alongside proposed distribution reforms.
- When
- The broader reforms are planned for the next financial year; distribution reforms could begin January 1 or April 1, 2027.
- Where
- India; the announcement was made in an interview from Mumbai.
- Why
- To strengthen trust, improve efficiency and ensure policyholders benefit from lower costs or better insurance outcomes.
- Regulator
- Insurance Regulatory and Development Authority of India (IRDAI)
- Chairman
- Ajay Seth
- Planned reform areas
- Claims management, grievance redressal and insurance products
- Distribution proposals
- Lower expense limits, product-linked commission caps, remuneration disclosure and mis-selling clawbacks
- Possible implementation
- January 1 or April 1, 2027
- Consultation status
- The distribution proposals are open for stakeholder comments and require draft regulations before finalization
- Expected consumer benefit
- Lower premiums or moderated premium increases, better savings-product returns and improved general-insurance claim ratios