Application for Grant of Certificate of Registration:
- The applicant should make an application regarding the type of insurance broker business.
- The application for an Insurance Broker License must be made in FORM B- Schedule I of the IRDAI(Insurance Brokers) regulations.
- The application must be submitted with documents mentioned in FORM-C Schedule I of the IRDAI(Insurance Brokers) regulations.
- For granting the certificate of registration, an application must be submitted along with the fees specified in FORM D- Schedule I of the IRDAI(Insurance Brokers) Regulations. The fees that has to be paid for application for an insurance broker is as follows:
- Direct broker Rs.25,000.
- Re-insurance broker Rs.50,000.
- Composite broker Rs.75,000.
- Apart from this, there are mandatory fees that has to be paid for the registration requirements:
- Direct Broker- Rs. 50,000/- after granting of an in-principal approval where the application is new. In case of renewal of registration, the fees will be Rs 1,00,000/- for a period of 3 years.
- Re-insurance Broker- Rs. 1, 50,000/- after granting of an in-principal approval where the application is new. If there is a renewal of registration, then the fee to be paid for renewal is Rs. 3,00,000/- for 3 years.
- Composite Broker- Rs.2, 50,000/- after granting of an in-principal approval where the application is new. If there is a renewal of registration, then the fee to be paid for renewal is Rs. 5,00,000/- for 3 years.
- The fee payable as the mandatory fee would be for the validity period of the certificate of registration.
- Fees must be paid through electronic means or demand draft (DD) payable in favor of the Insurance Regulatory and Development Authority of India, Hyderabad.
Clarification/ Further Information
- The applicant can be asked to furnish further information by the authority
- If required, the applicant has to submit these documents within 30 days from receiving the intimation from the authority.
Procedure for Issuing Insurance Broker License (registration)
- If the authority feels that all the requisite information complies with the Insurance broker license, then an in-principal approval would be provided to the applicant for complying with the requirements related to the certificate of registration.
- The authority will grant the certificate if the applicant has complied with the laws and regulations.
- The certificate of registration as an Insurance Broker License would be given to the applicant when the applicant satisfies that the code of conduct would be adhered to.
- The broker applying for a certificate of registration can also apply for any other registrations under the IRDAI. Such other registration would only be granted to the applicant after issuing the certificate of registration for the first instance
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- An applicant can make a new application if the certificate of registration has been canceled/ repealed due to a change in law or held by a Securities Appellate Tribunal or any court of law. An application under this can only be made after one year to the concerned authority.
Rejection
- An application for starting an insurance business can be rejected if the authority feels that the applicant has not fulfilled the necessary requirements.
- The authority must communicate the refusal to grant the application for an Insurance broker license within 30 days of communication of the rejection.
- An applicant can make a new application after one year of rejection of the application.
Conditions for Granting the Insurance Broker License
The IRDAI makes certain conditions before granting the insurance brokers license:
- The insurance broker must conduct the business according to the rules of the IRDAI.
- If the insurance broker business has provided false or misleading information regarding the particulars of the business, then the same must be intimated to the authority.
- Insurance broker business must handle all grievance procedures of clients within 14 days of receiving the complaint. The business must keep information regarding the number of complaints received from customers.
- Insurance brokers must reasonably conduct their business under the rules laid down by the IRDAI.
- The insurance broker must maintain books of accounts.
- Insurance broker should not conduct multi-level marketing or solicitation.
Documents required for Insurance Broker License
- Submission of relevant information as required in the Schedule I – Form B.
- Copy of the Memorandum of Association and Articles of Association should be according to the requirements of the Companies Act 2013.
- Remittance of the Fee for the particular category of Insurance broker license.
- Training for the employees starting an insurance broker business
- Schedule-I Form F should have the relevant data of the principal officer.
- Fit and Proper certification, which is required as per Schedule-I Form G.
- Declaration submitted by a key management executive, principal officer, director of the company that they are not having any form of disqualification under the Act.
- Details of Directors/ Partners, Promoter and Key Management Personnel are to be provided in the Form.
- Schedule I- Form F- List of qualified persons responsible for managing and procuring brokerage business along with their qualifications.
- Details of statutory auditors and Principal Bankers along with the Bank Account Number of the applicant. Details of infrastructure, including IT infrastructure along with supporting evidence thereof like ownership or lease agreement evidencing that sufficient space is present for managing the brokering business.
Validity for Certificate of Registration for Insurance Brokers License
- A certificate granted by the IRDAI would be valid for three years from the date of issue. This would be subject to the order from the authority.
- An insurance broker would not be permitted to do the Insurance Broker business without possessing a proper certificate and registered with the authority
Insurance Broker License Renewal
- Applications for renewing an insurance broker license must be made to the relevant authority 30 days before the expiry of the license. The application must be made in FORM K of Schedule –I of the regulations.
- If an application is made after the expiry of the above period, but before the actual expiry of the certificate, then a payment of Rs. 100/- must be made with the application.
- If there is a delay in making an application for renewal of registration, then the same must be made by the applicant. If this is within 60 days of the expiry of the certificate of registration, the applicant would have to pay Rs. 750/-.
- Any application which is received after the expiry of the 60 days would be considered only after 1 year. In the one year, the insurer must not conduct any business or solicit any form of business.
- An Insurance broker cannot apply for renewal after 90 from the expiry of the certificate.
- Insurance brokers cannot business of brokering after the expiry of the certificate except serve existing policyholders.
- The application for renewal of certificate for broker insurance would be the same as the new application.
- If the application or renewal is rejected, the same has to be notified to the applicant
Please refer to the Insurance Regulatory and Development Authority of India(Insurance Brokers) Regulations, 2018 on www.irdai.gov.in
