On this page
Earlier report,
IRDAI proposes nil third-party commission on new-car policies as dealer MISPs average 38% on new-vehicle cover
Our read
The principle of nil commission on new-vehicle third-party cover is more likely than not to survive, but likely in softened form, and it will push dealers' insurance income down from the 38% average.
For operators
Model dealership insurance income with new-vehicle third-party commission at zero (own-damage and renewals are not addressed in the summary), since the 38% average MISP payout is the margin at risk, and file comments before October 25 while planning for showroom Bima Sugam QR placement.
Watch
Public comments from dealer federations and insurer bodies, filed by the October 25 deadline
The report,
IRDAI's consultation paper says motor dealers earn an average 38% commission on new-car insurance. It proposes nil commission for distribution entities on new-vehicle third-party cover and a showroom QR code for the Bima Sugam platform. Comments are open until October 25, 2026.
- Average MISP commission, new-vehicle policies38%
- Average OEM broker commission, new-vehicle policies27%
What we verified
Checked against the other reports of this story.
- Proposed dealer commission on new-vehicle own-damage cover: 5% — Mint and Financial Express agree.
What to watch next
- Whether IRDAI's final text keeps nil commission on new-vehicle third-party cover or substitutes a non-zero rate
- Any change to the 2.5% agent rate or the 5% not-for-profit platform fee cap
- Insurer or OEM announcements of showroom Bima Sugam QR integrations or new broker tie-ups
- Listed dealership groups' commentary on insurance income or margin guidance
Likely next moves
Our read of what comes next — analysis, not reported by the source.
- Dealer associations are likely to file comments before October 25 arguing that MISP commission funds showroom operations, and to press for a phase-in or a carve-out.
- Insurers may start repricing or restructuring new-vehicle distribution deals, shifting from dealer-led payouts toward OEM-broker and direct channels if nil commission looks probable.
- OEMs and their captive brokers (27% average commission) are likely to position themselves as the compliant alternative and seek to hold new-car policy sales in the showroom.
- Dealer groups may try to replace lost insurance income by raising fees on other showroom products such as accessories, extended warranties and finance.
- IRDAI is likely to keep the nil third-party principle in the final rules while adjusting details, and to promote Bima Sugam QR codes in showrooms as a flagship consumer-cost measure.
Updates
Each later report on this story, newest first. Earlier entries are never edited; a correction is a new entry.
Irdai proposes capping dealer commission on new-vehicle own-damage cover at 5%, against an earlier average of 26%
- Earlier average dealer commission on third-party cover: 22%
- Dealer and OEM-broker share of motor premium: 46%
- Motor commission growth between FY23 and FY25: 259%
- Motor premium growth between FY23 and FY25: 34%
On the record
Earlier IRDAI reports on RetailIntel, newest first.
Reported figures
From the report. Source details below
| Average OEM broker commission on new-vehicle policies: | 27% |
|---|---|
| Motor distributor commission in FY 2025: | ₹7,050 crore |
| Motor insurance premium in FY 2025: | ₹29,000 crore |
| Proposed third-party commission for agents: | 2.5% |
| Proposed platform fee cap for not-for-profit platforms: | 5% |