Insurance Broker License

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Insurance Broker License

In India IRDA i.e. e Insurance Regulatory and Development Authority governs and issues Insurance Broker License & its services. For Insurance Broker license the ” Insurance Regulatory and Development Authority Act, 1999 with the Authority in consultation and the Insurance Advisory Committee”, makes the rules & regulations. The purpose of establishing this regulation is to watch & supervise insurance brokers. The insurance brokes suggests people regarding their insurance needs and after than guide them to pick the right insurance product for them. The Insurance Brokers act as the middle person among the insurance company and the people searching for buying insurance policies. They have a deep knowledge of the insurance-related laws & products.

Who is Insurance Broker?

An insurance broker is a company/business or person registered as an advisor of insurance or qualified people or firm which acts by its partners/directors or employees with expert knowledge of insurance-based laws. Insurance brokers lead people to their insurance demands. Moreover, they offer expert services to their customers. Acts as a mediator among a person and an insurance company asking to buy an insurance policy.

An insurance broker can be classified in there 3 Types

  • Direct Insurance Broker– solicitation and acquisition of the business of insurance and allows its client to buy an insurance policy from its website or Computer software. And gets commission charges from the insurance company whose policy has been sold. You can have a full see all the function of Direct insurance broker
  • Composite Insurance Broker – Is an insurance agent and operates a valid license to give insurance-related services for both lives & general insurance. The composite insurance broker licensing process is highly selective by the authority.
  • Reinsurance Broker – A company that can fix reinsurance on behalf of an insurance company.

Who can apply for Insurance Broker License?

According to IRDAI Regulations, the insurance broker license candidates can be anyone from the following :
  • Company registered under the Companies Act, 2013
  • Any registered co-operative society made under provisions of Co-operative Societies Act, 1912, or any similar law
  • Limited Liability Partnership ( LLP)registered under the LLP Act, 2008
  • Any other person approved by the Authority
  • Non-resident entity
  • Foreign LLP enrolled under foreign country lawss
  • Person resident outside India.

What is included Package

Submit application FORMS B
Examine the Application FORMS
Submission of the documents
Issuance of in-principle approval

Documents required to apply for insurance broker license

The following are the documents to be submitted as mentioned in Form C of Schedule I of the IRDA Regulations :

  • Insurance Broker License application & other mandatory documents to be submitted in Form B.
  • Photocopy of the MOA & AOA of the company.
  • The applicant should submit information about a Principal officer such as qualifications, training compliance, and other criteria as mentioned in Form G of Schedule 1
  • A written declaration of the Principal officer along with the directors/partners and required managers, confirming that they don’t abide by any disqualifications as mentioned in Section 42D of the Act.
  • Complete details of every director/partner, promoter, and important managerial personnel.
  • Current bank account details.
  • List of a minimum of two qualified brokers and their qualifications.
  • List of all shareholders of the applicant company; present as well as proposed. If the shareholder is a company, provide the Board Resolution passed by the company in investing and promoting the applicant company.
  • Information regarding the Principal Bankers and the statutory auditors.
  • Balance sheet of the company.
  • Details of infrastructure like IT infra, tools, office area, & the workforce.
  • Other documents as required

Frequently Asked Questions

What is the Insurance broker License?
It is a license that is established under IRDA and complies with the rules & regulations of the Insurance Regulatory and Development Authority Act, 1999 with the Authority in consultation and the Insurance Advisory Committee. The license is issued to make a control over all the insurance brokers, their activities & activities.
Who is responsible for the registration of an Insurance broker license?
For example, non-depositing NBFCs have no requirement for a cash reserve ratio (CRR), nor are they required to maintain a statutory liquidity ratio (SLR). Banks are expected, on the other hand, to maintain a CRR on which they earn no interest and a 24 percent SLR.
Who is an Insurance broker?
Insurance brokers is a person who acts as a mediator between the insurance company and the person who is searching for insurance policies.
What is the validity period for the insurance broker license?
The validity of the Insurance broker Certificate of Registration given for three years from the date of such issuance, after that apply for renewal.
What are the requirements for Insurance Broker License?
• The entity name should contain the word ‘Broker’ or ‘Broking.’ • If the capital pay holds any foreign capital, it should not exceed 26% of the total paid-up capital. • The principal officer must have a basic qualification, undergone training, and cleared the broker’s exam. • The company must include at least 2 persons with enough qualifications and training. • Insurance broking must be the chief purpose of the Memorandum of Association.

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