Corporate Agent in Insurance Sector
In the ever-expanding insurance sector, corporate agents seamlessly connect insurers with policy-seekers, amplifying the market penetration of diverse insurance products. Within the purview of rights conferred by IRDAI (Registration of Corporate Agents) Regulations, 2015, a corporate agent can team up with companies belonging to life, general, and health categories to solicit and service insurance products. The role of a corporate agent in the insurance sector is beyond instrumental. In this guide, we will take a closer look at the legal aspects of becoming a registered corporate agent in the insurance sector.
Who Can Become a Corporate Agent in the Insurance Sector?
The following is the list of the entities that can apply to IRDAI to become a registered corporate agent.
- Companies Registered Under the Companies Act, 2013: Businesses incorporated under this law or its erstwhile versions can apply for this registration.
- Limited Liability Partnerships: LLPs registered under the Limited Liability Partnership (aka LLP) Act, 2008 can apply.
- Co-operative Societies: Societies operating under the Co-operative Societies Act, 1912, or relevant laws are eligible to apply.
- Banking Companies: Banks operating within the purview of clause (4A) of Section 2 of the Banking Regulation Act, 1949 are fit to apply.
- Regional Rural Banks (RRBs): RRBs that fit Section 3 of the Regional Rural Banks Act, 1976 can apply easily.
- Non-Governmental Organizations (NGOs): Microfinance organizations or NBFCs operating under the ambit of RBI can apply without a fuss.
Documents For Becoming A Corporate Agent in the Insurance Sector
Becoming a registered Corporate Agent in the insurance sector requires adhering to underlying norms and meeting specific requirements. Here is the breakdown of requirements that come into play when applying for IRDAI approval.
Let’s talk about the documentation that is mandatory for agent registration:
- Certificate of Incorporation evidencing the firm registration under the eligible legislation.
- Net Worth Certificate reflecting the firm’s financial health to pursue the corporate agent business.
- Memorandum of Association and Articles of Association reflecting, management hierarchy, objectives, members’ obligations, etc.
- Audited Financial Statements for the last two years, showcasing profitability that reinforces apt financial health.
- Organization chart highlighting the position of key officials, including the Principal Officer (PO).
- Fit and Proper Undertaking: A detailed prerequisite reinforcing the qualification and eligibility of all directors and the PO.
- Business Plan and Strategy showcasing how an entity proposed to achieve speculated goals.
- Training and Examination Credentials confirm that the PO has the required skills and is eligible for the position.
- Infrastructure evidence such as lease agreements, equipment lists, and manpower details, showcasing the operational capabilities of the firm.
- Board-Approved Policy showing the firm’s commitment towards prevailing tie-ups, grievance redressal mechanisms, and reporting.
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Key Declarations to be Submitted to IRDAI:
- Declaration showing the PO’s appointment
- Declaration reinforcing that the firm has nothing to do with the other financial regulators.
- Statement showcasing the FDI threshold in the entity’s capital.
- Projected financials, including a three-year profit and loss statement and balance sheet.
Underlining Steps of Becoming a Corporate Agent in the Insurance Sector: A Detailed Process
The registration process for becoming a Corporate Agent in the insurance sector has been simplified after the advent of the online portal. The section below reflects detailed steps for securing the IRDAI approval.
1. Submission of Request for Login Credentials:
The first step involves submitting the required paperwork to secure the login credentials. Key documents that you must upload include:
- Net Worth Certificate
- Certificate of Incorporation i.e. COI
- Memorandum of Association i.e. MoA
- Financial Statements (Audited one for the last two years)
2. Accessing the Portal:
The hassle-free submission of the above documents leads the applicant to secure the credentials, which they can use to log into the online portal.
3. Uploading the Checklist:
Upon successful login, upload the mandatory dossiers as shown below:
- Company’s profile
- Form A (Application Form)
- Certificate of Registration (COI)
- Organization Chart
- Infrastructure Documents
- Fit and Proper Undertaking for Directors and the PO
- Training, Examination, and Educational Documents of the PO
4. Business Strategy Submission:
Provide an all-encompassing business plan showing blueprints for product promotion, tie-ups, grievance management, etc.
5. Approval and Fee Payment:
Upon document vetting and the authority’s approval, the requisite fees should be paid to mark the end of the filing process.
6. Certificate Issuance:
IRDAI shall vet the documents against underlying norms and subsequently grant the Certificate of Registration (COR) provided the assessment’s outcome comes out positive.
7. Obligations to be Fulfilled Post-Registration
After receiving the COR, Corporate agents must abide by an array of operational norms. Some of them include:
- Submission of checklist concerning PO and Specified Person (SP) for licensing
- Uploading tie-up agreements with insurers.
- Filing half-yearly and annual returns on the portal.
8. Fee Structure for Corporate Agents
The fee structure for registering as a Corporate Agent is as follows:
| Category | Amount Payable (INR) |
| Application Processing Fee: | 10,000 |
| Registration Fee: | 25,000 |
| PO Certificate: | 500 |
| SP Certificate: | 500 |
Why Become a Corporate Agent in the Insurance Sector?
A registered corporate agent serves as an invaluable asset for insurers because they promote inclusivity and trust among policyholders. Being a corporate agent gives you access to a robust career path that invites immense profitability and growth. Here are some top reasons why you might want to be a corporate agent in the status quo.
- Diverse Opportunities: The insurance sector has been witnessing a healthy growth rate in the past years across all verticals, including life, general, and health. In 2022 and 2023, the insurance sector saw a y-o-y growth of 13% in premium income with private insurers witnessing a 16.34% increase and public insurers experiencing almost 11% growth. These numbers signify the robust growth of the sector, reinforcing the apt demand for corporate agents in the sector.
- Revenue Streams: Given the sector’s consistent growth, registered agents can reinforce a steady source of income either via commission or a flat rate.
- Regulated Framework: Insurance is among the most regulated sectors in India, making it highly reliable and consistent.
- Business Expansion: Continual work with an insurer can enable the agent to procure significant capital over time, paving the foundation for a seamless business expansion.
Key Takeaways
Becoming a corporate agent in the insurance sector can be a profitable affair provided the one adheres to operational norms. By referring to the above guide, one can seamlessly transform into an IRDAI-approved partner who can facilitate the services concerning the corporate agent to prominent insurers in India.
Also Read: IRDAI Corporate Agents Regulations: A Comprehensive Guide
