IRDAI moots 10-fold hike in penalties to curb mis-selling

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To curb mis-selling and enhance service standards, the Insurance Regulatory and Development Authority of India (IRDAI) has suggested a ten‑fold rise in penalties for omissions by principal officers of corporate agents.

According to the draft IRDAI (Insurance Intermediaries) (Amendment) Regulations, 2026, the proposed penalty for these violations would rise to ₹10 crore, up from the existing ₹1 crore.

These steps aim to bolster supervisory oversight, reduce mis‑selling incidents, and elevate service quality among insurance intermediaries,” the regulator stated.

Transparency and accountability

The draft regulations further aim to boost transparency and accountability, while making business easier by simplifying regulatory procedures, cutting compliance costs, and providing greater certainty and continuity for insurance intermediaries.

Under the proposed transparency provisions, corporate agents, insurance brokers, insurance marketing firms, and web aggregators that generate commission income exceeding ₹10 crore in a fiscal year must submit annual disclosures to IRDAI on commissions earned, related‑party transactions, profits, and dividends. They must also post these disclosures on their websites.

The regulator says the proposals aim to reinforce accountability and raise governance standards throughout the insurance distribution chain, while easing business operations for intermediaries.

Published on June 22, 2026