Insurance Broker License

Apply today’s simplified process for online submission.
And you can Begin Insurance Broking business within 90 Days….!!!
That includes :

Approval from IRDA
Insurance broker Company registration
Advisory on Work Flow and SOP
Business & Operational plan for Next 5 Years
End to End Follow-up with IRDA
Comprehensive USA market entry strategy

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.

In 2018, an updated version of IRDA (Insurance Broker) Regulations, 2018 were circulated by the IRDA. As per these laws, Insurance Broker License can be done in any of the following sections:

Direct Insurance Broker License – Capital required Rs. 75 Lakh
Composite Insurance Broker License – Capital required Rs. 5 Crore
Reinsurance broker License – Capital required Rs. 4 Crore

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
Note: If the candidate of Insurance Broker License application is a registered LLP then none of the following can be a partner of the same;
Non-resident entity
Foreign LLP enrolled under foreign country laws
Person resident outside India.

Requirements for Insurance Broker License

Minimum Financial Requirements

Paid-up Capital/ Contribution Requirement. See the following is the minimum capital want to apply for insurance broker registration:

For Direct Broker – Rs. 75 Lakh
For Reinsurance Broker – Rs. 4 Crore
For Composite Broker – Rs. 5 Crore

Net worth Requirement

At the time of enrollment and during Insurance Broker License the insurance broker is need to keep a minimum net worth of

Rs. 50 Lakh for Direct Broker and
50% of the Minimum Capital Requirement for reinsurance & composite Broker.

Deposit Requirement

Before applying for the registration application and during Insurance Broker License the candidate is asked to deposit with the scheduled bank an amount of:

Rs. 10 Lakh for Direct Broker and
10% of the Minimum Capital Requirement for reinsurance & composite Broker.

Procedure to get Insurance Broker License

Submit application FORM B

Examine the Application

Submission of the documents

Issuance of in-principle approval

Issue of Certificate of Registration in Form J

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

Detailed Steps for Apply for Insurance Broker License

Once you have gathered all the documents required for Insurance Broker license, you can follow the below steps to for the registration process:

Step 1:

You require to apply for the Insurance Broker License in Form B as given in Schedule I of the IRDA regulations with authority. Even, you too need to present the non-refundable application fee with the required documents.

Step 2:

If the authority raises any question after the verification of the application for the Insurance Broker License, it can ask the applicant for additional documents and information. Besides, it can order the applicant to comply with any demands.

Step 3:

Within 30 days from the date of such communication, the candidate is required to present information required, the document needed or clarification as the case be.

Step 4:

After being satisfied that the candidate meets all the requirements, the Authority will issue in-principle permission for the registration.

Step 5:

When the issue of in-principle approval, the candidate is needed to comply with the additional demands and submit Insurance Broker License fees with the Authority online.

Step 6:

If the Authority is convinced that all the requirements affirmed in the Act, regulations, rules, guidelines, circulars, etc. are met by the candidate along with the provisions stated in the in-principle approval certificate, then it will give a Certificate of Registration in Form J guided in schedule 1

Insurance Broker License fee

Application for Insurance Broker Licenses must be submitted along with the requisite fees as defined in Schedule I – Form D of these regulations.

Non-Refundable Application Fees

For Direct Broker – Rs. 25,000
For Reinsurance Broker – Rs. 50,000
For Composite Broker – Rs. 75,000

Registration Fees for Fresh Registration

For Direct Broker – Rs. 50,000
For Reinsurance Broker – Rs. 1,50,000
For Composite Broker – Rs. 2,50,000

Renewal Fees for 3 years

For Direct Broker – Rs. 1,00,000
For Reinsurance Broker – Rs. 3,00,000
For Composite Broker – Rs. 5,00,000

Insurance broker License Validity & Renewal

Insurance broker Certificate of Registration is allotted for three years from the date of such issuance. The certified insurance broker is required to apply for the renewal of the Insurance Broker License at least 1 month before the expiry of these three years of registration. Otherwise, his/her license gets expired and they have to pay penalties. And more delays will also take them to the consequence of issuing a fresh license.

Checklists for Insurance Broker Registration

You must satisfy the following guidelines for obtaining Insurance Broker Registration:

An entity must have the word Broking or Broker in its name
MOA must include the insurance broking as its principal aim
Whether the company satisfies the least capital requirement as presented in the regulations
It must not hold any foreign capital which exceeds 26% of the total paid-up capital
If the fixed deposit of 20% of first capital is paid in the certified bank
The principal officer must keep the fair qualification, should have passed the brokers’ exam, and maintain the required training
The company must engage a minimum of 2 persons with the obligatory qualification and training
The company has the needed infrastructure and well-trained workforce to run the business of insurance broking
The persons involved in securing insurance business are qualified and trained

Frequently Asked Questions

What is the Insurance broker License?

Who is responsible for the registration of an Insurance broker license?

Who is an Insurance broker?

Who can apply for Insurance Broker License?

How to get an Insurance Broker License?

What is the cost of an Insurance Broker License?

What are the renewal fees for the insurance broker license?

What are the documents required for the Insurance broker license?

What is the validity period for the insurance broker license?

What are the requirements for Insurance Broker License?