The General Insurance Council has been encouraged by the Insurance Brokers Association of India (IBAI) to have an industry discussion about the shift of the Goods and Services Tax (GST) burden to intermediaries.
Additionally, it “urged the Council to encourage insurers to honor current commission agreements, avoid discouraging the servicing of retail health plans, and engage intermediaries before revising payment terms.” It also expressed worries about market behavior. IBAI made this statement after a submission from its leadership to Tapan Singhel, the chairman of the GI Council, on Monday, October 13, 2025.
The Association noted that it had brought attention to “important concerns impacting transparency, market behavior, and policyholder welfare in the general insurance industry” in its representation of 750 licensed insurance brokers nationwide. The move coincides with reports that insurers have reduced the commission they pay to intermediaries in order to make up for the loss of Input Tax Credit (ITC) after the abolition of GST from individual life and health insurance.
According to an IBAI statement, standardized and time-bound co-insurance brokerage settlement criteria are necessary to expedite operations and cashflows, and an industry-wide discussion on shifting the GST burden to intermediaries is necessary to ensure viability and compliance. In order to increase consumer confidence, boost distribution effectiveness, and guarantee steady market expansion, the Association further reaffirmed its resolve to collaborate with the GI Council, the government, and regulators.
Building a more transparent and equitable insurance ecosystem, inviting the IBAI nominee as a special invitee to GI Council meetings to discuss policyholder and distribution issues, adopting a fair and uniform arbitration clause for all policy types, and establishing a joint working group to operationalize an alternative dispute resolution framework are some of the main recommendations in its representation.
IBAI is suggesting quarterly product-level publication of claim settlement percentages, loss ratios, and response times on insurer websites in order to improve transparency and customer safety. Additionally, it has called on top leadership to accelerate the settlement of expensive and protracted claims and suggested designating a grievance redressal officer for commercial claims inside each insurer. IBAI president Narendra Kumar Bharindwal said, “When all stakeholders collaborate and decisions are made via open discussion, it leads to better results for consumers and develops enduring confidence in the system.”
Stronger cooperation and positive communication between all industry groups and stakeholders are crucial, Mr. Singhel said.