Kathmandu. The Insurance Regulatory and Development Authority of India has proposed a sweeping overhaul of insurance regulations in June 2026. The proposal, which was introduced after the enactment of the ‘Sabka Bima Sabka Raksha (Insurance Laws Amendment) Act, 2025’, aims to create new investment opportunities, maintain strict transparency for intermediaries, and increase market access and accountability.
The proposals, which have been made public through three drafts and three consultation papers, have taken strict measures to protect consumer interests.TAG_OPEN_p_12
The proposed Act prioritizes the accountability of the parties involved in the sale and distribution of insurance policies. In order to curb the tendency of misleading the insured and selling the insurance policies in the wrong way, from now on, every policy will be linked to the name of the person selling it indirectly. Whether it is a bank, broker or agent, the details of the person who sells the insurance policy should be clear. In the current system, when insurance policies were sold through banks or institutional agents, only the institution was liable.
In order to make the regulation and legal compliance more stringent, the NRA has increased the maximum fine from Rs 1 crore to Rs 10 crore.TAG_OPEN_p_10 In addition, a permanent registration system will be implemented for intermediaries (e.g. third-party managers, surveyors, institutional agents, insurance brokers and web aggregators) instead of fixed-term licenses. However, they will have to pay an annual fee for its continuance.
{{TAG_OPEN_p_9} Institutional agents such as banks and large retailing networks have proposed to mandatorily have at least one qualified staff in each of their branches to operate the insurance business.
This new framework is expected to remove the ambiguities between the bye-laws and the original Act and help in uniform and strict enforcement across the country.
