Insurance stocks came under pressure after Irdai issued a consultation paper on 'Recalibrating Economics of Insurance Distribution', setting out a comprehensive framework of reforms covering insurance distribution, its structure, expenses, commissions, market conduct, transparency and leveraging digital infrastructure.
PB Fintech is currently trading at Rs. 1398.60, down by 491.40 points or 26.00% from its previous closing of Rs. 1890.00 on the BSE. The scrip opened at Rs. 1701.00 and has touched a high and low of Rs. 1701.00 and Rs. 1398.60 respectively. So far 17897 shares were traded on the counter.
Max Financial Services is currently trading at Rs. 1392.50, down by 163.10 points or 10.48% from its previous closing of Rs. 1555.60 on the BSE. The scrip opened at Rs. 1400.10 and has touched a high and low of Rs. 1429.45 and Rs. 1360.00 respectively. So far 215533 shares were traded on the counter.
Turtlemint Fintech Solutions is currently trading at Rs. 109.10, down by 27.25 points or 19.99% from its previous closing of Rs. 136.35 on the BSE. The scrip opened at Rs. 109.10 and has touched a high and low of Rs. 119.00 and Rs. 109.10 respectively. So far 99602 shares were traded on the counter.
HDFC Life Insurance Company is currently trading at Rs. 532.30, down by 29.80 points or 5.30% from its previous closing of Rs. 562.10 on the BSE. The scrip opened at Rs. 530.15 and has touched a high and low of Rs. 535.15 and Rs. 514.15 respectively. So far 507616 shares were traded on the counter.
Insurance Regulatory and Development Authority of India (Irdai) has proposed prohibiting 'dark patterns' on insurance websites, including practices that require customers to provide personal details to access product features and pricing information. As part of wide-ranging reforms aimed at making insurance distribution more transparent and customer-centric, Irdai has issued a consultation paper on 'Recalibrating Economics of Insurance Distribution', setting out a comprehensive framework of reforms covering insurance distribution, its structure, expenses, commissions, market conduct, transparency and leveraging digital infrastructure.
The regulator proposes to replace the existing complex and fragmented architecture with three broad categories of distribution entities: Insurance Distribution Entities (IDEs), Insurance Distribution Persons (IDPs) and Market Infrastructure Institutions (MIIs). The Expense of Management (EoM) framework is proposed to be recalibrated through lower limits with a phased glide path. For life insurers, the EoM limit would move to a company-level basis linked to Gross Direct Premium Income (GDPI), with the limit proposed at 15 within two years and 12.5 within five years.
For general insurers, the basis would shift from gross written premium (GWP) to domestic GDPI, with the EoM limit reducing from 30 per cent of GWP to 20 per cent of GDPI within five years, also through progressive annual reductions. The proposed reduction in EoM is intended to lower the overall cost of insurance, thereby expanding the risk pool available in general insurance and enhancing returns to policyholders in life savings products. Irdai has invited comments till October 25, 2026.
The consultation paper proposes tracking dark patterns and making relevant performance information available to strengthen market discipline. It said product, pricing and quality disclosure should be made by all insurers in a standard and easy-to-understand form without seeking personal details. Currently, product features and pricing details can be accessed by the public only after providing personal details. It said “That is one of the 'dark patterns' often seen on the websites of most insurers and distributors. That is also against the guidelines issued by the Central Consumer Protection Authority under the Consumer Protection Act, 2019”.
Dark patterns mean any practices or deceptive design patterns using user interface or user experience interactions on any platform that are designed to mislead or trick users into doing something they originally did not intend or want to do. The commission framework is proposed to be recalibrated in parallel. Instead of a uniform approach, commission limits would take into account the segment, line of business, distribution channel, product complexity and the effort involved in selling and servicing the product.
Irdai also proposed stronger safeguards against mis-selling, including making suitability an enforceable obligation, documenting customer needs and suitability for specified life insurance sales, and maintaining an audit trail. The primary aim is to foster a customer-centric, competitive, efficient and transparent distribution ecosystem, while enabling better and sustainable outcomes for policyholders, insurers and distributors. Irdai said the proposed reforms are anchored in the expectations of the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025, which seeks to accelerate the growth and development of the insurance sector, strengthen policyholder protection, improve ease of doing business and enhance transparency in regulation-making and regulatory oversight.
