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Listen to this article in summarized format Alliance Insurance Brokers' proposed stake sale and the InsuranceDekho-RenewBuy proposed IPO are among deals that could be affected, depending on their exposure to retail distribution. IRDAI said broker-sourced premium grew 37% between FY23 and FY25, while commissions surged 173%, with average rates rising from 8.5% to 17%. Also, higher compliance costs and lower payouts could accelerate consolidation among smaller brokers, experts say. Emails sent to Alliance, O3 and InsuranceDekho did not receive response until press time. "The consultation paper has left the industry uncertain about the extent of the impact, as commission limits will vary across products, lines of business and distribution channels," said an executive of a broking company. Industry representatives estimate that some brokers could see revenue decline 60-70% if the proposals are implemented in their current form, though the final impact will depend on the business mix of individual players. "The economics has changed," said a senior insurance broker of a large broking, adding that ongoing IPO and strategic sale plans would have to be reassessed once greater clarity emerges on the final regulations. IRDAI has proposed prescriptive commission limits based on product complexity, distribution channel and the effort involved in selling insurance. The regulator has also proposed lower expense-of-management limits and greater scrutiny of distribution costs. The proposed changes could make it difficult for buyers to value such businesses based on their existing revenue and margins, industry executives said. "The buyer and seller will have to decide," the broker said. "Whoever is buying, they do not know what valuation they can put to the business." The regulator itself has invited stakeholder comments until October 25. Until the final commission structure is known, investors may find it difficult to estimate future revenue, margins and valuations. (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
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