Insurance regulator IRDA has asked life insurers to disclose the commission paid to agents for unit-linked products amid a debate over huge pay-outs given to them vis-a-vis mutual funds.
“…it has been decided to disclose the commission or brokerage payable to an agent or broker explicitly…from enhanced transparency view point,” Insurance Regulatory and Development Authority (IRDA) said in a circular.
The information will bring about more transparency by providing prospective policyholders clear information about the amount that has been collected from them as brokerage or commission, the circular said.
The new rule will come into effect from July 1, 2010.
The decision to disclose commission comes at a time when market regulator SEBI and IRDA are locked in a battle for control over ULIPs–or equity linked insurance plans.
The commission paid on ULIPs has been a long-standing grouse of the mutual fund industry.