What are the Vital Documents Required for Insurance Broker License?
Those who want to sell insurance products of other insurance companies can avail Insurance Broker License. The issuance authority of such a license is the IRDA or Insurance Regulatory and Development Authority. For this license, the IRDA Committee makes the rules and regulations. The primary purpose of forming their regulation is to observe and monitor insurance brokers. The insurance brokers advise people about their insurance requirements and, after that, guide them to choose the perfect insurance product for them. The brokers act as the middle person among the people and insurance company who are searching for purchasing insurance policies. They have in-depth knowledge of insurance-related products and laws. Scroll down to check all the essential documents required for Insurance Broker License.
Insurance Broker License – An Overview
Before we talk about the vital documents required for Insurance Broker License, let us first understand about Insurance Broker License in India. The Insurance Advisory Committee drafted the provisions and rules for such a license under the IRDA Act, 1999. The primary purpose of drafting such regulation is to supervise the actions of an insurance broker and ensure that they are working under the bylaws.
The primary role of a broker is to provide the perfect insurance product or plan to the customers who are looking for a good insurance plan as per their requirements. They assist the customers to choose the right product to maximize advantages. In India, to avail of an Insurance Broker License, one has to file an application to the IRDA.
Who can file for the Insurance Broker License in India?
Following is the list of all the eligible applicants who can file for an Insurance Broker License:
- LLP (Limited Liability Partnership) operating under the LLP Act, 2008;
- Company functioning under the provisions of Companies Act, 2013;
- Registered Co-operative Society established under the norms of the Co-operative Societies Act, 1912;
- Any individual possesses the required certification from the authority. Note: if an individual is registered LLP, then the following individual cannot be a partner of the same;
- Individual residing outside India.
- Non-resident company.
- Foreign LLP is operating under overseas country laws.
The applicant wants to commence brokering activities require to file a comprehensive application for the same and attached it with the obligatory document. The below section would explain the documents required for Insurance Broker License.
Essential Documents Required for Insurance Broker License in India
Following is all the vital documents required for an Insurance Broker License; however, remember that the given list encloses the specific documents mentioned in Form C of Schedule I of the IRDAI Regulations.
- Submit an application of the Insurance Broker License and other mandatory documentation to be submitted in Form B;
- Submit the copies of MOA (Memorandum of Association) and AOA (Article of Association) of the organization;
- Submit a written declaration declared by the directors, partners, and principal officer about their qualification and other criteria as stated in Form G of Schedule 1;
- Complete details regarding the director, promoter, and other managerial personnel;
- Details of the bank account (account number, IFSC Code, branch name, etc.);
- The applicant must provide the details of the Principal Officer in terms of qualification, training compliance, and other criteria as stated in Form G of Schedule 1;
- Particular related to 2 qualified brokers and their qualification;
- A detailed list of all members linked with the company. If an organization is acting as a member, then provide board resolution confirmed by the company;
- A balance sheet of the company;
- Facts related to the company’s infrastructure such as IT infrastructure, workplace, workforce, equipment, and area of business;
- Other documents as comprised in the form.
So, this is the detailed list of all the vital documents required for an Insurance Broker License; without any such document, you are not able to get Insurance Broker License. So it is advisable to arrange all the documents before applying for registration carefully.
Application Process and Fees Structure for Insurance Broker License
After collecting all the above-mentioned documents, the applicant requires to apply Form B as mentioned in Schedule I of the IRDA Regulations with authority. The application will be submitted with the fees, which are non-refundable with the aforementioned documents. The authority will examine the application to identify the possible loopholes in the same. If the authority manages to find any issue or problem, then it will copy the application and ask them to take needed actions to eliminate the discrepancies.
In contrast, if the authority finds the application without any errors on every aspect, then they will issue the in-principal consent for the registration. Always remember that such consent is not equivalent to a registration certificate. Instead, it acts as provisional consent to conduct brokering activities for a limited time frame. At this time frame, the authority undertakes an estimation to examine the performance of the applicant and search for potential violations of the bylaws. If they found everything perfect under the limit of compliances, then they will issue the certificate.
The direct broker has to endure a total of Rs. 25,000/- as a fee for application which is non-refundable. Similarly, the applicants like reinsurance and the amalgamated broker have to pay fees up to Rs. 50,000/- to Rs. 70,000/- respectively to avail an Insurance Broker License. The authority has created a different fee structure for the new applicant searching for the license. The authority demands the fees of Rs. 50,000, Rs. 1,50,000, and Rs. 2,50,000 from Direct, reinsurance, and combined broker respectively for issuing the license. The license remains the same for three years, and after that, the applicant needs to apply for renewal.
An applicant requires to submit a long list of vital documents required for an Insurance Broker License. If you are going to make a business decision regarding the same, you should obey the aforementioned guidelines correctly. If you find it too hard to arrange all the documents and registration process, you can hire an expert who will help you.