RBI Proposes Stricter Bancassurance Norms: Two-Tier Model for Banks Selling Insurance

RBI on February 11, 2026, proposed a comprehensive overhaul of rules governing how banks sell and refer third-party financial products, including insurance. The new framework takes effect from April 1, 2026.

Two Distinct Models: Agency model (fee-based distribution, no risk participation) and Referral model (one-time referral fee only, no commissions or trails). Third-party products limited to regulated products only.

Sources: RBI Press Release (February 11, 2026), ET BFSI (February 11, 2026)