New Delhi, Sept. 27 -- Insurance premiums could come under pressure if the Insurance Regulatory and Development Authority of India's (IRDAI) proposed reforms reduce distribution and operating costs, but the regulator has not said that premiums will automatically become cheaper. The consultation paper proposes changes to insurers' Expenses of Management (EoM), commission structures, sales incentives and disclosures, with the broader objective of reducing structural costs and improving value for policyholders.

The impact on premiums will depend on how insurers respond to lower costs. An industry expert, who did not wish to be named, said it would be too early to conclude that premiums will necessarily become cheaper. For term plans, mortal...