INCOME TAX3 Oct 2026
Buying new car? Your motor insurance dealer may earn up to 38% commission - what IRDAI's proposed fix means | Mint
The IRDAI has proposed changes to motor insurance commissions after its consultation paper showed distributors earned almost ₹7,050 crore on ₹29,000 crore of premium in FY 2025. Dealer-linked sellers of new-car policies earned average commissions of up to 38%. IRDAI wants these policies sold on the Bima Sugam platform, with dealers showing buyers a QR code option, so buyers can buy cover on their own.
Key Statutory Highlights
- According to IRDAI's consultation paper, distributors earned almost ₹7,050 crore as commission on ₹29,000 crore of motor insurance premium in FY 2025.
- For newly purchased vehicles, OEM brokers get an average commission of 27%, while Motor Insurance Service Providers, which include motor vehicle dealers, receive 38%.
- IRDAI has proposed that motor insurance for new and old vehicles be available on Market Infrastructure Institution platforms such as Bima Sugam, with the platform fee for not-for-profit platforms capped at 5% of premium.
Actionable Advice for Taxpayers / Founders:When you buy your next car, ask the dealer to show you the insurance option on the MII platform, such as Bima Sugam, and compare that quote with the dealer's policy before you decide.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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