🚗 IRDAI Master Circular on Car Insurance (2025): What It Means for Insurance Advisors

🔑 What Does the Circular Say?

1. More Motor Third-Party Policies Needed

   • Insurers must increase sales of motor TP policies depending on their market share in the TP segment.

   • Smaller players must grow faster (12.5%–13.75%), while bigger ones have lower but steady growth targets (5%–5.5%).

   
   ✅ Example:
   If XYZ Insurance has a 3% TP market share, it must sell 10% more TP policies this year and 11% more next year.
   👉 Advisor Takeaway:
   Expect company targets to shift towards motor TP sales. Advisors who specialize in motor insurance can position themselves as key contributors.
   

2. Rural Sector Obligations

   • Every insurer must insure a minimum percentage of vehicles in rural Gram Panchayats.

   • FY 2025-26: 15% coverage.

   • FY 2026-27: 25% coverage.
     

   ✅ Example:
   If a village has 1,000 vehicles, the insurer must cover at least 150 this year, and 250 next year.
   Note: The circular does explicitly state that Gram Panchayats (GPs) will be allotted to insurers.
   It lays out the process for allocation, what insurers must do once allocated, and the percentages they must cover.
   

   👉 Advisor Takeaway:
   This opens huge rural business opportunities. Advisors in small towns and villages can become the “go-to” person for vehicle owners who never considered insurance before.
   

3. Quarterly Reporting

   • Insurers must report performance every 3 months.

   • Data will be cross-verified with RTOs and the Insurance Information Bureau.
     

   👉 Advisor Takeaway:
   Advisors who consistently hit TP policy numbers will get recognition faster, since companies are being closely monitored.
   

📈 How Advisors Can Capitalize

1. Shift Focus to Motor TP Policies

   • With companies under pressure, advisors who bring steady TP business will become more valuable.

   • Cross-sell: A simple third-party policy today can lead to comprehensive upgrades later.
     

2. Tap the Rural Opportunity

   • Rural and semi-urban areas are underserved. Advisors who expand networks here will ride the growth wave.

   • Tie up with local vehicle dealers, mechanics, and transport unions.
     

3. Educate Customers

   • Many still think third-party insurance is just “formality.” Advisors should explain its importance for accident liability.

   • Use real-life stories of accidents where TP insurance saved families from financial ruin.
     

4. Be Digital-Ready

   • With reporting being strict, companies will push for digital issuance of policies. Advisors must get comfortable using online portals, apps, and e-KYC systems.
     

5. Build Long-Term Trust

   • Each TP customer is a potential upgrade to comprehensive motor insurance, health riders, or even life insurance. Treat these policies as door-openers.
     

✅ Advisor’s Roadmap

• Today: Learn the new rules. Be ready for new sales targets.

• Next 6 months: Focus on vehicle-rich villages/towns. Build relationships with transporters, cab drivers, fleet operators.

• Next 1 year: Position yourself as a motor insurance specialist who can handle TP + comprehensive + add-ons.

• Beyond: Use the TP policy base to grow cross-selling business (health, life, investment-linked plans).
  

🛣️ Final Word

The IRDAI Master Circular is not just compliance for insurers.
👉 It’s a golden chance for advisors:

• More policies to sell,

• New rural markets opening up,

• Higher recognition if you deliver.

Those who prepare now — by learning, networking, and digitizing — will lead the way in the motor insurance boom.