IRDAI Makes Salesperson Tagging Mandatory on Insurance Policies from January 2027: What it means for mis-selling

The Insurance Regulatory and Development Authority of India (IRDAI) has made it mandatory for insurance intermediaries to identify the authorised salesperson who sold a policy, in a move aimed at improving accountability and traceability in the insurance distribution chain.

The requirement, approved at IRDAI’s 137th Authority meeting on July 28 and notified through the Insurance Intermediaries (Amendment) Regulations, 2026, will come into effect from January 1, 2027.

Under the new framework, the proposal form, insurance policy and certificate of insurance will have to carry the name and functional identity of the authorised salesperson involved in the sale. The mobile number and email address of the relevant branch or office will also have to be disclosed.

The requirement covers sales made through different intermediary channels, including corporate agents, brokers, insurance marketing firms and other authorised intermediary channels.

IRDAI introduces policy-level sales traceability

The new rule is designed to create a clear trail between an insurance policy and the person responsible for soliciting or selling it.

For policies sold through an intermediary’s digital platform without an individual salesperson, the documents must instead carry the telephone number and email address of the intermediary’s Principal Officer. This ensures that a policy still has an identifiable point of accountability, even when no individual salesperson is involved.

IRDAI said the measure will improve oversight of insurance distribution and give policyholders greater transparency over the sales process.

The change comes as the regulator continues to tighten oversight of insurance intermediaries and address concerns around sales practices.

Why the move matters for bancassurance

The requirement could have particular significance for bancassurance, where insurance products are distributed through banks and their employees or other authorised sales personnel.

In such cases, customers may know the bank or branch through which they purchased the policy but may not have a formal record identifying the individual who solicited the sale. That can become relevant when a policyholder later alleges that the product was misrepresented during the sales process.

Mis-selling complaints can involve claims that a policy was presented as a fixed-return or deposit-like product, that important exclusions were not explained, or that the customer was not adequately informed about surrender conditions, lock-ins or other policy features.

The new tagging requirement does not automatically establish liability in such cases. Instead, it creates a documented link to the salesperson, allowing the insurer, intermediary or regulator to trace the person associated with the transaction.

IRDAI’s move follows a broader regulatory focus on accountability in insurance distribution. In June, the regulator had proposed mandatory tagging of policies to the individual responsible for the sale as part of draft reforms for intermediaries.

What policyholders should retain when buying insurance

The new requirement will provide an official record for policies covered from January 1, 2027. Until then, policyholders may need to maintain their own documentation if questions arise about how a policy was sold.

Customers buying insurance through an agent, bank or intermediary should retain the proposal form, benefit illustration, premium quotation, policy document and payment records. Written communication with the salesperson or intermediary should also be preserved where it contains information about benefits, returns, exclusions or other material features.

The identity and contact details of the person selling the policy can also be recorded at the time of purchase. These records can become important if the policyholder later disputes what was communicated during the sales process.

Existing intermediary rules already require authorised sales personnel to provide relevant information about insurance products and take the prospect’s needs into account when recommending a policy. Regulatory rules also prohibit misleading statements and inducing customers to provide incorrect or incomplete information.

Older policies will not lose access to grievance mechanisms

The new tagging requirement applies from January 1, 2027, but policyholders with policies purchased before that date can still raise complaints about mis-selling.

IRDAI’s Bima Bharosa system allows policyholders to register complaints against insurers and identify the intermediary or agent involved. The regulator’s complaint form specifically asks for details such as the insurance company, intermediary or agent, policy or proposal number and supporting information.

For an older policy where the individual salesperson cannot be identified, documents such as the proposal form, policy records, emails, messages, benefit illustrations and other sales-related communication can help establish the circumstances surrounding the purchase.

Policyholders generally need to approach the insurer’s grievance redressal mechanism first. If the complaint is not resolved satisfactorily, it can subsequently be escalated through the regulatory grievance mechanism, subject to the applicable process.

Stronger accountability, but mis-selling claims will still need evidence

The salesperson-tagging rule represents a shift from identifying only the insurer or intermediary towards establishing individual-level traceability for insurance sales.

For policyholders, this could make it easier to establish who was responsible for a transaction when questions arise over the sales process. For intermediaries, it means maintaining more detailed records and ensuring that sales personnel comply with applicable conduct requirements.

However, the presence of a salesperson’s name on a policy will not by itself prove that mis-selling occurred. Any complaint will still have to be assessed based on the policy terms, disclosures, sales records and other available evidence.

With the requirement taking effect from January 2027, the insurance industry now has a defined transition period to implement the necessary systems. For customers, the immediate change is less about a new product or benefit and more about a clearer paper trail around who sold the policy an important distinction as IRDAI steps up its focus on policyholder protection and sales accountability.

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Disclaimer: This MyRupia article is for informational purposes only and is based on publicly available government, regulatory and industry sources. It should not be treated as investment, financial, tax, insurance, or legal advice. Information, examples, market data, and expert views mentioned in the article may change over time and should not be considered a recommendation to buy, sell, invest in, or surrender any financial product. Readers should evaluate their individual circumstances and consult a qualified financial professional before making decisions.