IRDAI Proposes Overhaul to Cut Commissions and Mis-selling

India’s insurance regulator wants to change how insurance is sold.

It says distributors are often rewarded for making sales instead of helping customers choose suitable policies.

This can lead to mis-selling and policies being stopped early.

The regulator wants fewer and simpler types of distributors.

It also wants clearer prices, more choices and fewer compulsory insurance bundles.

Insurance sellers may be allowed to offer other financial products if the relevant regulators approve.

Life-insurance commissions would depend more on customers continuing their policies.

New digital systems could let people compare and buy insurance directly.

IRDAI says it will measure whether the changes improve complaints, costs, persistency and customer satisfaction.