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The shares of PB Fintech, the parent company of Policybazaar, fell over 30% in Thursday’s trade after the Insurance Regulatory and Development Authority of India (IRDAI) proposed changes to insurance distribution and commission structures. On the stock exchange, PB Fintech's stock fell from its previous close of Rs 1,886.30 to Rs 1,282 during the day. The sell-off came after IRDAI released its consultation paper on September 23. The regulator has proposed product- and channel-wise caps on commissions across life, health and general insurance. For individual life insurance policies with a premium-payment term of 10 years or more, IRDAI has proposed a first-year commission cap of 20% for distribution entities and 25% for individual agents. For policies with a six-to-eight-year premium-payment term, the proposed caps are lower at 14% for distribution entities and 17.5% for agents. For individual pure-term insurance policies with multi-year premiums, the proposed first-year commission is 25% for distribution entities and 30% for agents. Renewal commissions would be capped at 7.5% and 10%, respectively. The proposal also covers health insurance. For individual health policies, the first-year commission has been proposed at 15% for distribution entities and 20% for agents. Renewal and portability commissions would be capped at 5% for distribution entities and 10% for agents. Motor insurance will also see tighter limits. IRDAI has proposed zero commission for distribution entities on third-party motor insurance. For new vehicles, commission on own-damage, personal accident and legal liability covers has been proposed at 5% for distribution entities and 10% for agents and associates. The proposed changes could impact PB Fintech as Policybazaar earns revenue by distributing insurance products. Lower commission caps could reduce the amount distributors earn on new policies and renewals, putting pressure on their take-rates and earnings. IRDAI said the proposed framework would link commissions to factors such as product complexity and the effort required to sell the policy. It also proposes counting different forms of distributor payments to prevent companies from bypassing the commission limits. However, the proposed commission structure is not final yet. IRDAI has invited feedback from stakeholders before taking the proposals forward.
document fetched 2026-09-25 02:59