{"id":2377,"date":"2021-02-17T05:49:25","date_gmt":"2021-02-17T05:49:25","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=2377"},"modified":"2021-02-17T05:58:40","modified_gmt":"2021-02-17T05:58:40","slug":"start-insurance-brokerage-business","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/","title":{"rendered":"Start Insurance Brokerage Business in India: A Complete Guide"},"content":{"rendered":"\n<p class=\"has-drop-cap\">In comparison to\na decade ago, today there are various options available of the Insurance\nProducts in the market. Due to which, a layperson may suffer confusion in\nselecting the right choice. Further, an Insurance Broker acts as a middleman\nbetween the insurance companies and the general public, and helps the people\nmake the right financial decisions based on their financial needs. To start\nInsurance Brokerage Business in India, one needs to acquire the <strong><a href=\"https:\/\/swaritadvisors.com\/insurance-broker-license\" class=\"text-primary\">Insurance Broker\nLicense<\/a><\/strong> from IRDAI (Insurance Regulatory Development Authority of\nIndia).<\/p>\n\n\n\n<p>In this blog, we\nwill discuss the concept, requirements, and procedure to start Insurance\nBrokerage Business in India.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a5af9a1080f4\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a5af9a1080f4\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Concept_of_Insurance_Broker\" title=\"Concept of Insurance Broker\">Concept of Insurance Broker<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Laws_Governing_Insurance_Brokerage_Business_in_India\" title=\"Laws Governing Insurance Brokerage Business in India\">Laws Governing Insurance Brokerage Business in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Different_Types_of_Insurance_Broker_in_India\" title=\"Different Types of Insurance Broker in India\">Different Types of Insurance Broker in India<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Direct_Insurance_Broker\" title=\"Direct Insurance Broker\">Direct Insurance Broker<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Reinsurance_Broker\" title=\"Reinsurance Broker\">Reinsurance Broker<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Composite_Insurance_Broker\" title=\"Composite Insurance Broker\">Composite Insurance Broker<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Eligibility_Criteria_to_Start_Insurance_Brokerage_Business_in_India\" title=\"Eligibility Criteria to Start Insurance Brokerage Business in India\">Eligibility Criteria to Start Insurance Brokerage Business in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Minimum_Requirements_to_Start_Insurance_Brokerage_Business_in_India\" title=\"Minimum Requirements to Start Insurance Brokerage Business in India\">Minimum Requirements to Start Insurance Brokerage Business in India<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Financial_Requirements\" title=\"Financial Requirements\">Financial Requirements<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Net_Worth_Requirements\" title=\"Net Worth Requirements\">Net Worth Requirements<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Deposits_Requirements\" title=\"Deposits Requirements\">Deposits Requirements<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Functions_of_Insurance_Broker_in_India\" title=\"Functions of Insurance Broker in India\">Functions of Insurance Broker in India<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Direct_Insurance_Broker-2\" title=\"Direct Insurance Broker\">Direct Insurance Broker<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Reinsurance_Insurance_Broker\" title=\"Reinsurance Insurance Broker\">Reinsurance Insurance Broker<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Composite_Broker\" title=\"Composite Broker\">Composite Broker<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Checklist_to_Start_Insurance_Brokerage_Business_in_India\" title=\"Checklist to Start Insurance Brokerage Business in India\">Checklist to Start Insurance Brokerage Business in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Documents_Required_to_Start_Insurance_Brokerage_Business_in_India\" title=\"Documents Required to Start Insurance Brokerage Business in India\">Documents Required to Start Insurance Brokerage Business in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Procedure_to_Start_Insurance_Brokerage_Business_in_India\" title=\"Procedure to Start Insurance Brokerage Business in India\">Procedure to Start Insurance Brokerage Business in India<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Submission_of_Application_Form\" title=\"Submission of Application Form\">Submission of Application Form<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Document_Examination\" title=\"Document Examination\">Document Examination<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Furnish_Additional_Documents\" title=\"Furnish Additional Documents \">Furnish Additional Documents <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Issue_of_In_Principal_Approval\" title=\"Issue of In Principal Approval\">Issue of In Principal Approval<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-23\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Additional_Submission_Requirements\" title=\"Additional Submission Requirements \">Additional Submission Requirements <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-24\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Issuance_of_the_Certificate_of_Registration\" title=\"Issuance of the Certificate of Registration\">Issuance of the Certificate of Registration<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-25\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Fees_for_obtaining_Insurance_Broker_License_in_India\" title=\"Fees for obtaining Insurance Broker License in India\">Fees for obtaining Insurance Broker License in India<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-26\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Non_Refundable_Application_Fees\" title=\"Non Refundable Application Fees\">Non Refundable Application Fees<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-27\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Registration_Fees_for_Fresh_Application\" title=\"Registration Fees for Fresh Application\">Registration Fees for Fresh Application<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-28\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Renewal_Fees_for_3_years\" title=\"Renewal Fees for 3 years\">Renewal Fees for 3 years<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-29\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Validity_of_Insurance_Broker_License_in_India\" title=\"Validity of Insurance Broker License in India\">Validity of Insurance Broker License in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-30\" href=\"https:\/\/swaritadvisors.com\/blog\/start-insurance-brokerage-business\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Concept_of_Insurance_Broker\"><\/span>Concept of Insurance Broker<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The term\nInsurance Broker means a person who advises people on their financial and\ninsurance needs and negotiates insurance deed and contracts on behalf of the Insurers.\nThat means an Insurance Broker abridges a gap between Insurance Companies and the\nGeneral Public. <\/p>\n\n\n\n<p>Also, it shall\nbe considerate to take into consideration that an Insurance Broker charges a\nfixed fee against the services provided by them.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Laws_Governing_Insurance_Brokerage_Business_in_India\"><\/span>Laws Governing Insurance Brokerage Business in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The laws\ngoverning the operations of an Insurance Brokerage Business are as follows:<\/p>\n\n\n\n<ul><li>Insurance Regulatory Development Authority Act 1999;<\/li><li>IRDA (Insurance Brokers) Regulations 2018;<\/li><\/ul>\n\n\n\n<p><strong>Also, Read:<\/strong> <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/learning\/what-documents-required-for-insurance-broker-license-in-india\/\">Documents Needed to obtain Insurance Broker License<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Different_Types_of_Insurance_Broker_in_India\"><\/span>Different Types of Insurance Broker in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The different types of Insurance Broker operating in India are as follows:<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Direct-Insurance-Broker-1024x269.png\" alt=\"Different Types of Insurance Broker in India\" class=\"wp-image-2379\" width=\"710\" height=\"186\" srcset=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Direct-Insurance-Broker-1024x269.png 1024w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Direct-Insurance-Broker-300x79.png 300w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Direct-Insurance-Broker-768x202.png 768w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Direct-Insurance-Broker.png 1200w\" sizes=\"(max-width: 710px) 100vw, 710px\" \/><\/figure><\/div>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Direct_Insurance_Broker\"><\/span>Direct Insurance Broker<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The term Direct\nInsurance Broker means a person who provides details concerning the various\ninsurance businesses and products available in the market. Further, they assist\ncustomers in choosing the right policy based on their financial needs as well. <\/p>\n\n\n\n<p>Also, the\nactivities, such as assisting clients in paying the premium or in opening an\ne-insurance account for a customer, etc., are included in the working of a\nDirect Insurance Broker as well.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Reinsurance_Broker\"><\/span>Reinsurance Broker<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>A Reinsurance\nBroker carries out similar operations that of a Direct Insurance Broker.\nFurther, the activities undertaken by a Reinsurance Broker are as follows:<\/p>\n\n\n\n<ul><li>Negotiation on behalf of Client;<\/li><li>Maintenance of Statistics of the Reinsurance Sector;<\/li><li>Selling of Products concerning Reinsurance;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Composite_Insurance_Broker\"><\/span>Composite Insurance Broker<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The term\nComposite Insurance Broker means a person who deals in the Insurance related matters\nto buyers. Further, the services offered by a Composite Insurance Broker\nrelates to Life and General Insurance. However, it shall be significant to\nstate that IRDAI grants Composite Insurance Broker license to only a few\napplicants, that, too, on a very selective basis.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Eligibility_Criteria_to_Start_Insurance_Brokerage_Business_in_India\"><\/span>Eligibility Criteria to Start Insurance Brokerage Business in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The eligibility\ncriteria to start Insurance Brokerage Business in India are as follows:<\/p>\n\n\n\n<ul><li>The applicant company must be registered under the <a href=\"https:\/\/en.wikipedia.org\/wiki\/Companies_Act_2013\">Companies Act 2013<\/a>;<\/li><li>In the case of a cooperative society, the same must be\nregistered based on the provisions of the Cooperatives Societies Act 1912;<\/li><li>In the case of <strong><a href=\"https:\/\/swaritadvisors.com\/limited-liability-partnership-registration\" class=\"text-primary\">Limited\nLiability Partnership<\/a><\/strong>, the same must be registered based on the\nprovisions of the LLP Act 2008;<\/li><li>Any other person recognized by the Authority;<\/li><\/ul>\n\n\n\n<p><strong>However, in the case of LLP, the following are not\neligible to become the partners of the firm:<\/strong><\/p>\n\n\n\n<ul><li>Non Resident Entity;<\/li><li>Any Foreign LLP;<\/li><li>Any Person who resides outside India; <\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Minimum_Requirements_to_Start_Insurance_Brokerage_Business_in_India\"><\/span>Minimum Requirements to Start Insurance Brokerage Business in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The minimum\nrequirements to start Insurance Brokerage Business in India are as follows:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Financial_Requirements\"><\/span>Financial Requirements<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The financial\nrequirements for an Insurance Broker License are as follows:<\/p>\n\n\n\n<ul><li>Rs 75 lakhs for Direct Insurance Broker;<\/li><li>Rs 4 crore for Reinsurance Broker;<\/li><li>Rs 5 crore for Composite Broker;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Net_Worth_Requirements\"><\/span>Net Worth Requirements<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The net worth\nrequirements for an Insurance Broker License are as follows:<\/p>\n\n\n\n<ul><li>Rs 50 lakhs for Direct Insurance Broker;<\/li><li>50% of the Minimum Capital for Reinsurance Broker;<\/li><li>50% of the Minimum Capital for Composite Broker;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Deposits_Requirements\"><\/span>Deposits Requirements<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The deposit\nrequirements for an Insurance Broker License are as follows:<\/p>\n\n\n\n<ul><li>Rs 10 lakhs for Direct Insurance Broker;<\/li><li>10% of the Minimum Capital for Reinsurance Broker;<\/li><li>10% of the Minimum Capital for Composite Broker;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Functions_of_Insurance_Broker_in_India\"><\/span>Functions of Insurance Broker in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The key\nfunctions of an Insurance Broker in India are as follows:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Direct_Insurance_Broker-2\"><\/span>Direct Insurance Broker<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The key\nfunctions of a Direct Insurance Broker are as follows:<\/p>\n\n\n\n<ul><li>Gather information on the Insurance Business and Risk\nRetention Plan of the Client;<\/li><li>Offer advice concerning the best Insurance Cover and\nTerms;<\/li><li>Guide about the available insurance market and\nproducts available;<\/li><li>Provide a quotation based on the client\u2019s\nconsideration;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Reinsurance_Insurance_Broker\"><\/span>Reinsurance Insurance Broker<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The key\nfunctions of a Reinsurance Broker are as follows:<\/p>\n\n\n\n<ul><li>Understand the nature of client\u2019s business and risk\nmanagement strategy;<\/li><li>Maintains clear and proper records and accounts of the\nInsurer\u2019s business;<\/li><li>Renders advice on the issues concerning Insurance\nCover and types of Insurance Covers available in the market;<\/li><li>Forms a database on the available reinsurance market,\nwhich comprises of solvency rating of each reinsurer as well;<\/li><li>Safeguards reinsurance sector;<\/li><li>&nbsp;Delivers risk\nmanagement services;<\/li><li>Proposes either reinsurer or group of reinsurers;<\/li><li>Negotiates with a reinsurer on behalf of the customer;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Composite_Broker\"><\/span>Composite Broker<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>A composite\nbroker performs functions of both Reinsurance Broker and Direct Insurance\nBroker.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Checklist_to_Start_Insurance_Brokerage_Business_in_India\"><\/span>Checklist to Start Insurance Brokerage Business in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The checklist to\nstart Insurance Brokerage Business in India can be summarised as:<\/p>\n\n\n\n<ul><li>Must end the company\u2019s name with the term \u201cBroking\u201d;<\/li><li>The Memorandum of Association must include the\nactivities of Insurance Broking as its principal business;<\/li><li>Must satisfy the criteria fixed for the financial,\ndeposit, and capital requirements;<\/li><li>Should not hold any Foreign Investment that exceeds\nthe threshold of 26% of the total paid up capital;<\/li><li>Needs to deposit 20% of the Initial Capital with any\nregistered bank;<\/li><li>The Principal Officer must have a fair qualification\nand adequate training, and must have passed the broker examination;<\/li><li>Needs to hire at least two people with compulsory\ntraining and qualification;<\/li><li>Should have the necessary infrastructure, together\nwith well experienced employees to carry out the business of Insurance Broking;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Documents_Required_to_Start_Insurance_Brokerage_Business_in_India\"><\/span>Documents Required to Start Insurance Brokerage Business in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Based on the\nprovisions of the IRDAI (Insurance Brokers) Regulation 2018, the documents\nrequired to start insurance brokerage business in India are as follows:<\/p>\n\n\n\n<ul><li>Application in Form B;<\/li><li>A copy of the drafted MOA and AOA;<\/li><li>Details concerning Principal Officer in Form G of\nSchedule I;<\/li><li>A declaration stating that the Principal Officers,\nDirectors\/ Partners, and other key administrative workforce are not covered\nunder the provision of section 42D of the Insurance Act;<\/li><li>Complete details concerning partners, advertisers,\ndirectors, and other KMPs (Key Managerial Personnel);<\/li><li>A complete list regarding the agents appointed,\ntogether with their qualifications;<\/li><li>Bank details of the applicant company;<\/li><li>Details concerning Principal Bankers, together with\nStatutory Advisors;<\/li><li>A complete list with the details of the shareholders\nof the applicant company;<\/li><li>A copy of the BR (Board Resolution) passed regarding\nthe investment and promotion of the company in the board meeting;<\/li><li>Audited Balance sheet of the applicant company;<\/li><li>Any other detail if in case required;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Procedure_to_Start_Insurance_Brokerage_Business_in_India\"><\/span>Procedure to Start Insurance Brokerage Business in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The steps involved in the procedure to start insurance brokerage business in India are as follows:<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Submission-of-Application-Form.png\" alt=\"Procedure to Start Insurance Brokerage Business\" class=\"wp-image-2380\" width=\"562\" height=\"276\" srcset=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Submission-of-Application-Form.png 1012w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Submission-of-Application-Form-300x148.png 300w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/02\/Submission-of-Application-Form-768x378.png 768w\" sizes=\"(max-width: 562px) 100vw, 562px\" \/><\/figure><\/div>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Submission_of_Application_Form\"><\/span><strong>Submission of Application Form<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>In the first step, the applicant company requires to\nfurnish Form B of Schedule I as a registration form for the Insurance Broker\nLicense, together with the non-refundable application fee. Also, it needs to\nannex the required documents in the application form to the IRDAI.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Document_Examination\"><\/span><strong>Document Examination<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Now, the authority will examine the documents and\napplication form submitted. Also, it shall be considerate to take into note\nthat at this stage, authority can raise queries and can request for more\ndetails, if it needs some clarification. Moreover, the authority can ask for\nthe submission of additional documents as well.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Furnish_Additional_Documents\"><\/span><strong>Furnish Additional Documents <\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>If in case the authority has asked the applicant to\nsubmit some additional documents, then, in this step, the applicant needs to\nfurnish the same within 30 days, starting from the date of receiving the\nintimation from IRDAI.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Issue_of_In_Principal_Approval\"><\/span><strong>Issue of In Principal Approval<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Once the documents furnished are examined and\nproperly verified, and the authority if of the opinion that the said applicant\nhad satisfied all the mandatory conditions and stipulations, then, in that\ncase, it will grant the in principal approval for the Insurance Broker License.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Additional_Submission_Requirements\"><\/span><strong>Additional Submission Requirements <\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>After getting the in principle approval, the said\napplicant company requires to adhere to all the additional requirements and\nconditions and needs to pay the specified license fees to the authority.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Issuance_of_the_Certificate_of_Registration\"><\/span><strong>Issuance of the Certificate of Registration<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>In the last step, if all the steps are properly met\nand all the documents are verified, and the authority has granted in principal\napproval as well, then, in that case a certificate of registration will be\nissued in the name of the applicant company by IRDAI.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Fees_for_obtaining_Insurance_Broker_License_in_India\"><\/span>Fees for obtaining Insurance Broker License in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The fees charged\nfor the Insurance Broker License can be summarised as:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Non_Refundable_Application_Fees\"><\/span>Non Refundable Application Fees<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The non-refundable\napplication fee charged for an Insurance Broker License are as follows:<\/p>\n\n\n\n<ul><li>Rs 25 thousand for Direct Insurance Broker;<\/li><li>Rs 50 thousand for Reinsurance Broker;<\/li><li>Rs 75 thousand for Composite Broker;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Registration_Fees_for_Fresh_Application\"><\/span>Registration Fees for Fresh Application<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The registration\nfee charged for a fresh Insurance Broker License application are as follows:<\/p>\n\n\n\n<ul><li>Rs 50 thousand for Direct Insurance Broker;<\/li><li>Rs 1.50 lakh for Reinsurance Broker;<\/li><li>Rs 2.5 lakh for Composite Broker;<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Renewal_Fees_for_3_years\"><\/span>Renewal Fees for 3 years<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The renewal fee\ncharged for an Insurance Broker License are as follows:<\/p>\n\n\n\n<ul><li>Rs 1 lakh for Direct Insurance Broker;<\/li><li>Rs 3 lakh for Reinsurance Broker;<\/li><li>Rs 5 lakh for Composite Broker;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Validity_of_Insurance_Broker_License_in_India\"><\/span>Validity of Insurance Broker License in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In India, the\nCertificate of Registration issued for an Insurance Broker Business remains\nvalid for a period of three years, starting from the date of the issuance of the\ncertificate. Further, an applicant company needs to file the application for\nrenewal of the license at least one month prior to the expiry of the actual\nvalidity period.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In\na nutshell, Insurance Broker\ndenotes a person who advises people on their financial and insurance needs and\nsuggests to them the best option available. Also, he negotiates insurance deed\nand contracts on behalf of the Insurers. In India, there are three types of\nInsurance Broker available, and all of them have their own separate set of\nrequirements, fees, and functions. <\/p>\n\n\n\n<p>Further, to start insurance brokerage business in India, one needs to satisfy all the intricate requirements and procedures mentioned above. At <strong><a class=\"text-primary\" href=\"https:\/\/swaritadvisors.com\/\">Swarit Advisors<\/a><\/strong>, our IRDA experts are there to solve out all the issues and to assist you in getting the license in an easy and hassle free manner.<\/p>\n\n\n\n<p><strong>Also, Read:<\/strong> <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/learning\/educational-requirements-for-insurance-broker-license\/\">Educational Requirements for Insurance Broker License<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In comparison to a decade ago, today there are various options available of the Insurance Products in the market. Due to which, a layperson may suffer confusion in selecting the right choice. Further, an Insurance Broker acts as a middleman between the insurance companies and the general public, and helps the people make the right [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":2378,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[44,43],"tags":[394],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/2377"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=2377"}],"version-history":[{"count":7,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/2377\/revisions"}],"predecessor-version":[{"id":2388,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/2377\/revisions\/2388"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/2378"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=2377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=2377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=2377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}