Multi-Year Health Insurance Policy Sales Dip
The sale of multi-year health insurance policies has experienced a downturn following the implementation of new accounting standards by the Insurance Regulatory and Development Authority of India (IRDAI) for non-life insurance companies. This shift has prompted insurers to revise the commission structure for agents, potentially making these policies less appealing for them to promote, according to sources familiar with the matter.
“There is a drop in sales of multi-year health insurance policies after the change in accounting norms,” stated an industry insider. “Agents are key distribution partners for health insurance products, and following the revision in norms, they may find it less attractive to focus on these policies because commissions are distributed across the policy’s term.”
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The recent changes in accounting norms by IRDAI have had a significant impact on the financial incentives for agents who sell these policies. The revised norms affect how insurance companies report premiums, leading to adjustments in how commissions are calculated and distributed. The decline in sales figures suggests that agents may be shifting their focus to other insurance products that offer more favorable commission structures. Further analysis will be observed in the coming months.
