Insurance Broker License in India: Process, Fee and Validity

Insurance Broker License
Ganesh Nair
| Updated: Aug 27, 2022 | Category: Insurance Broker

Uncertainty over life and the ever-increasing medical service cost has made us realise the importance of “insurance”. Insurance brokers are people who curate insurance policies keeping in mind the needs and wants of the customers. They act as a bridge between companies and their customers. In this blog, we shall find out the process of obtaining an Insurance broker license.

In India, all the aspects related to insurance are governed by the Insurance Regulatory and Development Authority Act, 1999. IRDA released new guidelines in 2018 under IRDA (Insurance Broker) Regulations, 2018.

Classification of Insurance Brokers:

Insurance brokers can be classified into three categories; these are:

  • Direct Brokers

Direct brokers are entities licensed by the IRDAI, these entities do an in-depth analysis of the needs of several customers. Then later inform about their needs to an insurance company. Direct brokers usually provide advisory services to their clients and help them select the most appropriate policy keeping in mind terms and conditions. Direct brokers act as per the directions provided by their clients. They have extensive information about the insurance sector and help clients settle their claims.

  • Reinsurance Brokers

Reinsurance brokers are insurers for insurance companies. The reinsurance brokers act as an intermediary for reinsurance contracts between direct insurance and reinsurers. A Reinsurance broker works for both parties; in such cases, he cannot keep in one party’s interest over the other. They try to find a consensus that is best for both the clients that they are representing.

  • Composite Brokers

Composite brokers are a combination of both the direct broker and reinsurance brokers. They have both types of clientele, ones which want to cater to consumers and others where both clients are insurance companies.

Minimum Capital Requirement and net worth for Insurance Broker license Type Minimum capital Requirement Maintenance of a net worth
1 Direct Brokers   75 lakhs 50 lakh
2 Reinsurance Brokers   Rs. 4 crore 50% of the minimum capital requirement.
3 Composite Brokers   Rs. 5 crore 50 percent of the minimum capital requirement.

Who can be an Insurance Broker?

  • A partnership business that is registered under the Limited liability Partnership Act, 2008[1]
  • A company formed as per the provisions of the Companies Act, 2013
  • Any Co-operative society that is established as per the rules laid down in the Co-operative Societies Act, 1912 or similar law.
  • Any other individual permitted by the IRDAI to work as an insurance broker.

What are the documents required for Insurance Broker License?

  • Must disclose all the information as needed by the Form-Bschedule1 of the regulations
  • Copy of Memorandum of Association and Articles of Association.
  • Payment of application fee as per the category the broker is applying for.
  • Fit and proper Declaration according to the For G of Schedule 1.
  • Documents specifying the details of Directors, partners, promoters and other Key management personnel.
  • Form F- stating the qualification of the people involved in managing the business.
  • Documents mentioning broker’s bank account details, statutory auditors and principal bankers
  • Form G of schedule-1 which contains ‘Fit and proper certification.
  • All the details of the infrastructure being utilised by the broker.

What is the procedure to obtain Insurance Broker License?

  • The applicant must make an application according to Schedule 1- Form B of the regulations.
  • The application must also state the type of broker the applicant wants to register as.
  • The applicant must also furnish all the documents that are required under Form C- of Schedule 1
  • If the above-mentioned process are completed and all the documents are submitted as specified in the rules, then the In-principal approval shall be granted to the applicant.
  • How the final registration certificate shall be issued when additional compliances are met. This shall be issued in Form J of Schedule 1
Particulars Application Fee After the receipt of In-principal Approval For Renewal
Direct Broker ₹ 25,000 ₹ 50,000 ₹ 1,00,000
Reinsurance Broker ₹ 50,000 ₹ 1,50,000 ₹ 3,00,000
Composite Broker ₹ 75,000 ₹ 2,50,000 ₹ 5,00,000

What happens if the application from the insurance broker is rejected?

In cases where discrepancies are found in the applicant’s form or documents, then the application shall stand rejected. However, the authority must communicate such rejection to the applicant within a period of 30 days. The applicant can re-apply after the expiration of 1 year of such rejection.

What is the validity of an Insurance broker License?

The insurance broker license is valid for up to a period of three years. The license holder must apply for a new license one month before the expiration of the license.


In order to operate as an insurance broker in India, a person must obtain the insurance broker license as per the norms set by IRDA. The license can be obtained by maintaining the required capital and submitting the application form along with documents and requisite fees. This license shall be valid for a period of three years.

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Ganesh Nair

Ganesh Nair completed his graduation in law from IP university. He is an ardent researcher who has written various research papers and articles on contemporary legal issues. His keen interest in the field of research made him pursue a career in legal research. His core area of interest include Cyber, IPR and Finance laws.


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