IRDAI proposes comprehensive reforms to insurance distribution and commission structures

…evaluating the proposals in detail to understand their implications for the business and the broader distribution ecosystem. There are areas where insurers would seek further clarity as the consultation progresses. “ At the heart of our assessment will be how the proposed framework balances distribution efficiency with the need for quality advice, long-term customer servicing and wider insurance penetration ,” he said. “After arriving at a comprehensive view, we will work together to co-create a calibrated action plan and engagement approach,” Rungta added. SHIFT According to Amit Goel, Director, Equirus Raghnall Insurance…

…Equirus Raghnall Insurance Broking, IRDAI’s proposed reforms would mark an important shift in insurance distribution — from simply chasing premium growth to focusing on quality, efficiency and customer value. “ For insurers and intermediaries, the proposed EoM glide path and effort-based commission structures should push the industry to look harder at acquisition costs, productivity, renewal quality and servicing efficiency ,” Goel said. The reforms can therefore encourage brokers to move from volume-led distribution to value-led advisory. “For customers, greater transparency and accountability should improve suitability and trust,” he…