Reducing Costs Key to Elevating Insurance Accessibility, Says IRDAI Official

A senior official from the Insurance Regulatory and Development Authority of India (IRDAI) has called for urgent measures to reduce customer acquisition and management costs in the insurance sector. Speaking at the CII-organized 'InsureInd', Deepak Sood highlighted the challenges of high distribution and administrative expenses, which he believes have perpetuated a cycle of low penetration and high costs.

According to Sood, addressing these financial pressures is crucial for boosting profitability, product affordability, and accessibility. His remarks coincide with the Economic Survey for FY'26, which identified rising acquisition and administrative expenses as significant constraints on industry expansion. Sood emphasized that breaking this cycle would enable the industry to serve the 'missing middle' households better.

The IRDAI member outlined several industry-wide solutions, including adhering to the 'Use and File' procedure for launching new products and prioritizing ethical sales practices. He underscored the importance of reducing costs, digital distribution, and customer-focused product development to ultimately increase the premium-to-GDP ratio and strengthen market penetration.