Business
PB Fintech shares decline 6% amid reports of regulatory push to cap insurance agent commissions
The move comes amid broader industry concerns over the implications of the proposed Insurance Bill 2025 on digital insurance marketplaces and intermediaries.
According to a report by NDTV Profit, the proposed Insurance Bill will empower the Insurance Regulatory and Development Authority of India (IRDAI) to cap agent commissions through formal regulations.
The bill is expected to strengthen oversight on commission payouts, disclosures, and rewards to agents and intermediaries in the insurance sector.
People familiar with the matter told NDTV Profit that IRDAI will decide commission limits directly via regulations, moving away from the earlier flexibility allowed under existing norms. The regulations are also expected to prescribe upper limits on any form of remuneration or incentive payable to agents or intermediaries.
These developments may have implications for platforms that rely on variable commission structures for insurance distribution.
Commenting on the development, Nilesh Sathe, Former IRDAI Member, told NDTV Profit that commissions and remuneration in insurance have historically had caps, and regulatory oversight on such payouts has always existed. He added that the updated regulations must be implemented within six months of the Act’s passage.The Union Cabinet approved the Insurance Amendment Bill, which raises the cap on foreign direct investment (FDI) in insurance companies from 74% to 100%. The reform will allow foreign investors to hold full ownership in Indian insurance companies, provided they invest the entire premium in India.
This was initially proposed by Finance Minister Nirmala Sitharaman in the Union Budget for FY 2025-26.
“Opening up insurance to 100% foreign investment comes at the right time, especially with the goal of insurance for all by 2047,” said Saharsha Keshkar, Head of Strategy and International Business, at EDME Insurance Brokers.
He added, “The sector needs long-term capital and global experience to reach deeper into under-insured segments and handle more complex risks. Done right, this move can help insurers build better products, improve service quality, and scale distribution beyond the metros.”
The current conditions and restrictions related to foreign investments in insurance are expected to be reviewed and simplified as part of the new framework. For customers, it should translate into wider choice and more reliable protection, while keeping strong regulation firmly in place.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
