Direct and digital channel

What is the direct and digital channel?

The direct channel covers policies an insurer sells to customers without an agent, broker, bank or other intermediary. The customer buys on the insurer's website or app, through its call centre, or from salaried employees in its branches or field sales teams. Because no intermediary is involved, no commission is paid, though the insurer still spends on marketing, technology and staff.

"Digital" overlaps with direct but is not the same thing. A policy bought online through a web aggregator or a broker's app is digital but not direct, because an intermediary is involved and is paid. A policy sold by an insurer's own salaried sales staff in person is direct but not digital.

How direct and digital sales work in India

• Who sells. Insurers' employees, call centre staff and websites. In life insurance IRDAI reports "direct" and "online" business separately in its channel data.
• Online platforms. Insurers and intermediaries sell online through what IRDAI calls an Insurance Self-Network Platform (ISNP), set up under IRDAI's 2017 guidelines on insurance e-commerce, with KYC, e-proposal and electronic policy issuance.
• E-policies. Policies are issued electronically and can be held in an e-insurance account with an insurance repository.
• Advertising rules. Online journeys must follow IRDAI's advertisement and disclosure rules, and the 2026 amendment to the broker regulations added an undertaking to follow the consumer protection authority's guidelines on dark patterns.

Share of business. In 2024-25, direct sales made up 10.68% of individual new business premium in life insurance and the separate "online" channel 0.87%, as reported from IRDAI's annual report. For private life insurers, direct sales were 17.09%. The public sector insurer reported no direct share in that data.

Bima Sugam. The industry-owned Bima Sugam platform is meant to let customers compare, buy and service policies from all insurers in one place. Its information hub went live in September 2025, and transactional services were planned in phases during 2026, starting with motor; check the platform for current status. IRDAI's September 2026 consultation paper describes Bima Sugam as the first market infrastructure institution, a "pull-based" route where customers come to buy rather than being sold to, and proposes that such platforms charge transparent fees well below current commission levels.

What the direct channel means for distribution

• Direct works best for products people search for. Term insurance, motor renewals, travel and top-up health are bought by customers who already know what they want. Savings and complex products usually still need a person to explain them, even when the purchase is completed online.
• Acquisition cost moves from commission to marketing. Search, social media, comparison listing fees and call centre staff replace commission. Insurers need to measure cost per acquisition on the same basis across channels to know whether direct is really cheaper.
• Price can differ by channel. Several insurers offer online variants of term plans at lower premiums. IRDAI's consultation paper proposes that distribution entities may not insist that an insurer charges the same price across all channels, which, if adopted, would make channel-specific pricing easier to sustain.
• Assisted digital is the common middle path. A customer starts online, gets a call, and completes the purchase with a salaried adviser. This keeps the sale direct but needs trained staff, recorded disclosures and suitability checks.
• Direct and intermediated channels coexist. Agents and partners worry that direct pricing undercuts them. Clear rules on which leads belong to whom, and on renewal ownership, reduce conflict.
• Persistency still matters. Online buyers can lapse as easily as they buy. Renewal reminders, auto-debit mandates and easy servicing protect direct business economics.

Direct vs intermediated sales