— Download the consultation paper here and here.
The Insurance Regulatory and Development Authority of India (IRDAI) has released a consultation paper proposing enhanced disclosure norms for insurance intermediaries that earn more than Rs 10 crore in commission in a financial year. These entities must annually disclose:
- Details of the commission earned;
- Related party transactions;
- Profits;
- Dividend repatriated.
These disclosures must be submitted to IRDAI and also published on the company’s website. The proposals form part of the draft IRDAI (Insurance Intermediaries) (Amendment) Regulations, 2026, which seek to strengthen transparency and accountability while easing compliance requirements.
Why this matters: This marks the first time the regulator has sought such detailed public disclosures from insurance intermediaries. However, the draft does not define how to report commissions.
Commission expenses constitute a major share of insurance brokers’ total expenses. According to IRDAI’s latest annual report, life insurers paid out commissions of Rs 60,800 crore during 2024-25, 18% YoY increase, while total premium grew by under 7% over the same period. The non-life insurance industry paid Rs 47,266 crore in commission in 2024-25, and IRDAI pulled up 23 insurers for exceeding expense limits.
The consultation paper also comes amid reports that IRDAI will release an insurance distribution reform paper aimed at capping commissions payable to agents and intermediaries. Under the IRDAI Expenses of Management Regulations 2023, insurers can incur expenses in the range of 30-35% of gross written premium. However, this cap continued to permit relatively high commission payouts.
A case in point is insurance distribution company Turtlemint, which made its stock market debut today. In FY23, the company earned Rs 369.7 crore from “marketing fees”, accounting for 88% of its total revenue of Rs 419.9 crore. When IRDAI revised commission regulations in FY23, its total revenue fell to Rs 78.6 crore in FY24, according to its IPO prospectus.
Earlier this month, PB Fintech Group CEO Yashish Dahiya recently told The Economic Times that if IRDAI introduces commission caps, it would pose an existential threat to insurance distributors and disrupt the company’s business.
Other key proposals under the exposure draft are:
1. Shift from recurring renewals to perpetual registration framework: The certificate of registration granted to insurance brokers will remain valid indefinitely, subject to payment of annual fees and unless surrendered, suspended or cancelled by IRDAI. Under the current framework, the certificate of registration is valid for three years.
- All existing corporate agents must apply for a fresh certificate of registration and pay the applicable annual fee. Once granted, they will be covered under the perpetual registration regime.
- They will need to pay a Rs 10,000 application fee and an…
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