The process of obtaining an Insurance Broker Licence begins with selecting an eligible form of business entity.

Under the applicable IRDAI framework, the following entities may apply for registration as an Insurance Broker:

1. A Company incorporated under the Companies Act, 2013 or the erstwhile Companies Act, 1956.
2. A Limited Liability Partnership (LLP) registered under the Limited Liability Partnership Act, 2008.
3. A Co-operative Society registered under the Co-operative Societies Act, 1912.
4. Any other individual or company that is allowed to conduct the business related to an Insurance Broker.

Another important aspect is the initial capital requirement for obtaining an Insurance Broker Licence, which is as follows:

1. Direct Broker: ₹75 Lakhs
2. Reinsurance Broker: ₹4 Crore
3. Composite Broker: ₹5 Crore

Net Worth Requirement: For the purpose of the applicable regulations, “Net Worth” shall have the meaning assigned to it under the Companies Act, 2013, as amended from time to time.

After obtaining Insurance Broker registration, the broker is required to maintain the prescribed minimum net worth at all times during the validity of the Certificate of Registration, as follows:

1. Direct Broker: ₹50 Lakhs
2. Reinsurance Broker: ₹2 Crore
3. Composite Broker: ₹2.50 Crore

In case the net worth falls below the prescribed minimum, the Insurance Broker must immediately restore the net worth to the required level and report compliance to IRDAI.

Documents Required for Registration as Insurance Broker

The following is an illustrative list of documents required for obtaining registration as an Insurance Broker with IRDAI:

1. Submission of relevant information as required in Schedule I – Form B.
2. Principal Officer details along with Fit & Proper Declaration.
3. Training and examination certificate of the Principal Officer.
4. Directors/Partners and Key Management Personnel details with Fit & Proper declarations.
5. Office and infrastructure documents, such as ownership/lease agreement and IT infrastructure details.
6. Projected financial statements and business plan for three years.

Insurance Broker Registration Procedure

The entire Insurance Broker registration process can be summarized as follows:

1. Entity Formation & Eligibility – Incorporate or identify an eligible entity and ensure compliance with the prescribed capital and net-worth requirements.
2. Principal Officer & Qualified Persons – Appoint the Principal Officer and required Broker Qualified Persons and complete the prescribed training and examination requirements.
3. Documentation & Application Filing – Prepare the business plan, infrastructure details, Fit & Proper declarations and other required documents, and submit the application to IRDAI with the applicable fee.
4. IRDAI Scrutiny & Compliance – Respond to queries or clarifications raised by IRDAI and complete any additional compliance or documentation requirements.
5. Grant of Registration – Upon satisfactory verification and fulfilment of all regulatory requirements, IRDAI grants the Certificate of Registration, enabling the applicant to commence insurance broking activities.

5. Does AB & Associates provide support after the Insurance Broker Licence is granted?

Our services extend beyond registration. We assist Insurance Brokers with post-registration and ongoing regulatory compliances, including net-worth related requirements, periodic submissions, regulatory reporting and other applicable IRDAI compliances