The Insurance Regulatory and Development Authority of India (IRDAI) may introduce its proposed insurance commission caps as early as January 2027, amid opposition from brokers over potential revenue losses and job cuts.

The regulator is considering January 1 and April 1, 2027 as possible implementation dates for its distribution reforms, Girija Subramanian, whole-time member (distribution) at IRDAI, told Bloomberg in an interview.

The proposals seek to curb distribution costs through product-wise commission caps and tighter limits on insurers’ overall expenses. IRDAI has argued that commissions have risen faster than premiums since rules were relaxed in 2023, without a corresponding increase in insurance coverage.

Subramanian said commission caps should take effect sooner, arguing that phased reductions could encourage distributors to rush sales and increase the risk of mis-selling. Separately, IRDAI’s consultation paper proposes a five-year transition to lower expense limits for insurers, with the first interim milestone in FY29.

“There is an earlier-the-better case, but getting the reforms right is more important than getting them early,” she told Bloomberg.

The proposals have implications for listed insurance distributors such as Policybazaar parent PB Fintech and Turtlemint, whose businesses depend on commissions from insurance sales. Shares of PB Fintech and Turtlemint have slumped over 47% each since IRDAI proposed the commission caps on September 23.

However, the framework is still under consultation. Stakeholders have until October 25 to submit comments, after which IRDAI will review the feedback and publish draft regulations for another round of consultation before issuing the final rules.

The Insurance Brokers Association of India (IBAI) has warned that the proposed norms could cut broking sector revenues by 60–70% and result in the loss of up to 10 Lakh jobs across insurance distribution.

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