Pvt life insurers mull new model for commission for distributor channels

Clawback, deferral, or reduction in payouts on the cards for distributors

Following recent revisions to surrender value norms, private sector life insurers are preparing to adjust commission structures for distributor channels, based on persistency metrics.

Top executives from leading life insurance firms are set to meet next week with the Life Insurance Council, an industry association, to establish a uniform commission framework, according to people familiar with the matter. Their objective is to maintain consistency in commission payments across the industry and mitigate disruption for distributors.

Options under consideration include clawbacks, commission deferrals, and outright reductions. For large corporate agents — such as banks and non-banking financial companies — insurers