In India, auto insurance is essential. Every vehicle operating on Indian roads is required to have a current insurance policy by the Motor Vehicles Act of 1988. Therefore, to lawfully drive their cars on Indian highways, car owners must purchase auto insurance plans. So, see below the motor insurance agent commission chart 2025.
Types of Vehicle Insurance Policies:
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Car insurance and two-wheeler insurance plans are the most often used types of vehicle insurance for individuals. Private and commercial auto insurance plans are two more categories for classifying auto insurance policies.
There are two types of insurance available for both private and commercial vehicles: comprehensive plans and third-party liability-only plans.
Third-party Liability-only Policy:
According to the guidelines established by the Motor Vehicles Act of 1988, only insurance is required. Third-party liability is covered by this policy in the event that the vehicle results in any of the following damages:
- Murders a third party
- Causes bodily harm to another person
- Harms the property of third parties
The owner of the vehicle is financially responsible for paying the third party for the harm in any of the aforementioned situations. This financial responsibility is covered by third-party coverage, which also pays the car owner’s liabilities.
Comprehensive Policy:
Only third-party liabilities are covered by third-party insurance. Third-party insurance plans do not cover the cost of repairs if the car itself is damaged. This is the point at which a complete policy becomes necessary. Both third-party liability and vehicle-related damages are covered by the comprehensive plan. A comprehensive plan will cover car damage resulting from the following unforeseen circumstances:
- Natural catastrophes such as storms, floods, landslides, lightning strikes, earthquakes, etc.
- Man-made catastrophes, such as theft, arson, rioting, and malevolent deeds.
- Damages sustained during the vehicle’s transit
Third-party liabilities are protected under “third party cover,” while the vehicle’s damages are covered under “own damage cover.” As a result, the rates for “own damage cover” and “third party cover” in comprehensive policies vary. The total premium for the plan is calculated by adding the two premiums.
Commercial Vehicle Insurance Plans:
You can also sell insurance policies for commercial vehicles. For both passenger-carrying vehicles (PCVs) and goods-carrying vehicles (GCVs), TurtlemintPro offers auto insurance policies. To increase your clientele, TurtlemintPro offers you a greater selection of auto insurance plans that you may include in your portfolio.
Commission Under Vehicle Insurance Policies:
The following four elements determine the car insurance agent commission that a vehicle insurance salesperson is entitled to receive:
- Type of policy sold: Because comprehensive plans offer a wider range of coverage, their premiums are higher. Therefore, selling comprehensive insurance coverage can result in a higher commission for the automobile insurance agent. Conversely, third-party plans pay less for the commission of auto insurance agents because their premiums are lower.
- Vehicle type covered by insurance: four-wheelers are worth more than two-wheelers. Four-wheeler insurance is therefore more expensive than two-wheeler insurance. However, the commission rate for car insurance agents is higher for two-wheeler rates, allowing the agent to make good money by selling two-wheeler plans as well.
- Age of the insured vehicle: The insured value of the vehicle is determined by the vehicle’s age. The premiums and, consequently, the car insurance commission you can receive as a vehicle insurance agent are influenced by the insured value.
- The quantity of premium collected: Your premium will increase in proportion to the amount of premium you collect.
Motor Insurance Agent Commission Chart 2025:
The highest vehicle insurance agent commission chart you can receive as a vehicle insurance agent for selling various kinds of auto insurance plans is as follows:
| Type of policy | Type of the vehicle | Age of the vehicle | The maximum rate of commission |
|---|---|---|---|
| Comprehensive policy | Four wheelers and other types of private vehicles | Any age | 15% of the own damage premium |
| Two-wheelers | 17.5% of the own damage premium | ||
| Comprehensive policy | Commercial Vehicles | 1-3 years | 15% of own damage premium |
| 4 years and above | 15% of own damage premium + 1.5% of third party premium |
||
| Standalone Third-party liability policy | All types of vehicles | Any age | 1.75% of the premium |
How to Calculate Motor Insurance Agent Commission?
-
Know the Type of Insurance Policy:
Commission rates differ based on the type of vehicle and policy:- Private Car Insurance: 10% to 15% of the premium
- Two-Wheeler Insurance: 15% of the premium
- Commercial Vehicle Insurance: 5% to 10% of the premium
- Renewal Policies: 5% to 10% commission
-
Get the Premium Amount:
This is the amount paid by the policyholder for coverage — not including GST or other charges. -
Find the Applicable Commission Rate:
The commission rate depends on:- Type of Policy: Comprehensive, Third-Party, or Add-ons
- Type of Vehicle: Car, bike, or commercial vehicle
- New Policy vs. Renewal: Renewals often have lower commissions
-
Apply the Commission Formula:
Commission = Premium Amount × Commission Rate (%) -
Example Calculation:
Let’s say you sell a comprehensive car insurance policy with a premium of ₹30,000 and a 12% commission rate:- Premium: ₹30,000
- Commission Rate: 12%
- Commission Earned: ₹30,000 × 12% = ₹3,600
-
For Renewals:
If the policy is renewed the following year with a ₹28,000 premium and a 7% commission rate:- Commission: ₹28,000 × 7% = ₹1,960
-
Additional Income from Add-Ons:
Selling add-ons like zero depreciation, engine protection, or roadside assistance can increase your commission. Add-ons usually carry 5% to 15% commission rates. -
Cross-Selling Opportunities:
You can boost earnings by cross-selling related products like:- Personal Accident Cover
- Extended Warranty Plans
- Roadside Assistance Plans
-
Performance-Based Incentives:
Insurance companies often offer extra bonuses or higher commission rates for hitting monthly or quarterly sales targets. -
Annual Earnings Estimation:
If you sell 10 car policies per month with an average ₹25,000 premium at a 10% commission rate:- Monthly Commission: 10 × ₹25,000 × 10% = ₹25,000
- Annual Commission: ₹25,000 × 12 = ₹3,00,000
FAQ:
Q. What does a motor insurance agent do?
A. A motor insurance agent helps clients buy vehicle insurance policies (like car, bike, or commercial vehicle insurance) and assists with renewals and claims. They act as a bridge between the insurance company and the customer.
Q. How much commission do motor insurance agents earn?
A. Commission rates vary by insurance company and policy type, but IRDAI guidelines usually cap them as:
Q. New Car Insurance: 10% to 15% of the premium
- Bike Insurance: 15% of the premium
- Commercial Vehicle Insurance: 5% to 10% of the premium
- Renewal Policies: 5% to 10% commission
Q. How is the commission calculated?
A. Commission = Premium Amount × Commission Rate (%)
For example:
Premium: ₹25,000
Commission Rate: 10%
Commission Earned: ₹25,000 × 10% = ₹2,500
Q. Do motor insurance agents earn commissions on policy renewals?
A. Yes, agents earn renewal commissions for every year the policyholder continues their motor insurance. Renewal commissions typically range between 5% and 10%.
Q. Are there any bonuses or incentives for agents?
A. Many insurers offer performance-based incentives, like higher commissions for achieving sales targets, bonuses, or extra earnings for cross-selling other insurance products.
Q. When is the commission paid out?
A. Commissions are generally paid monthly after the premium is collected and processed.
Q. What qualifications are required to become a motor insurance agent?
- Minimum 18 years old
- At least 10th or 12th pass, depending on the region
- Complete IRDAI training (50 hours)
- Pass the IRDAI exam and get licensed
Q. Is there a cap on how much commission an agent can earn?
A. No, there’s no upper limit on commissions — the more policies you sell and renew, the more you earn.
Q. Do agents need to handle claims?
A. Agents guide clients through the claims process but don’t directly handle claim approvals — that’s the insurer’s job.
Q. How can I increase my earnings as a motor insurance agent?
- Sell high-premium policies (comprehensive plans pay more than third-party)
- Encourage annual renewals
- Focus on long-term policy retention
- Cross-sell add-on covers like zero depreciation, roadside assistance, etc.