Shares of PB Fintech, the parent of Policybazaar, slipped 1.94% to ₹1,766.70 on Tuesday, September 24, after the Insurance Regulatory and Development Authority of India (IRDAI) raised concerns over high commission and distribution costs in the insurance sector.
In a meeting with insurance CEOs, the regulator told companies that such costs need to be brought down. According to sources, insurers suggested a proposal to cap commissions on the lines of the mutual fund industry’s Total Expense Ratio (TER) model. They are expected to submit a detailed presentation on the same to IRDAI.
Insurers also proposed disclosing commission details in policy documents to enhance transparency for policyholders.
For PB Fintech, which operates on a digital-first distribution model, the move has triggered investor caution. While lower commissions could benefit online aggregators in the long run, near-term uncertainty over regulatory changes weighed on sentiment, leading to the stock decline.
