Corporate Agency License

Overview

Companies, as well as banks, can obtain a Corporate Agency Licence. Therefore when a bank gets this licence, such a bank would be representing the interest of the insurance organization. This agreement is referred to as a bancassurance or partnership. Financial institutions offer insurance packages to the customers based on their requirements. A corporate agent can represent one life insurer, one non-life insurer, and a health insurer.

A Corporate Agent is an agent that sells the policies of insurance company, represents the interests of an insurance company and acts in the best interests of the insurance company and further requires to adhere and follow several guidelines. To function on behalf of Insurance companies, a corporate agent needs to procure a corporate agency license to act as corporate agent. If a company sells health insurance on behalf of an insurance organization, that company will be referred as a corporate agent for the insurance organization

Pursuant to the provisions of Insurance Regulatory and Development Authority of India (Registration of Corporate Agents) Regulations, 2015 which came in to force on 1st April, 2016 any person who wants to carry this business shall complete registration process of Insurance Regulatory and Development Authority of India (IRDAI).

The business of corporate agent means soliciting and servicing of insurance business for any of the specified category like life, general and health. Hence, Corporate Agents will be only for Life, General, Health or Composite, doing the business of solicitation and servicing for all category at one place. These registrations can have arrangements with a maximum three life insurer, three general insurer and three health insurers to solicit, procure and service their insurance products.

Meaning of Corporate Agency License

Pursuant to IRDAI (Insurance Regulatory Development Authority of India) regulations 2015, the Corporate Insurance Agent’s registration is mandatory. The regulations came into force on the 1st of April 2016, and since then, multiple corporate agents have been registered under the aforementioned provision.

Corporate Agents are All companies, LLPs, co-operative societies, NGOs, Rural banks or Micro Finance Lending Organizations participating in soliciting, producing or servicing of the life insurers, general insurers and health insurers business are Corporate Agents.

Following are the types of Corporate Agents in India-
1. Corporate Agent (Life)
2. Corporate Agent (General)
3. Corporate Agent (Health)
4. Corporate Agent (Composite)

Eligibility Criteria for Corporate Agent Registration in India

Following are the conditions that the corporate agent must meet for getting the registration:
1. The applicant should be any of the following entities:
A company registered as per the Companies Act

A Limited Liability Partnership registered under the LLP Act

A Co-operative Society registered under the Co-operative Societies Act.

A regional rural bank established under Section 3 of the Regional Rural Banks Act.

An NGO or a Micro Lending Finance Organization covered under Cooperative Societies Act.

2. There must be necessary infrastructure to roll out their activities. It consists of:
Adequately trained manpower
Adequate Office Space

Adequate Equipment

3. The principal officer should be a graduate and should have completed at least 50 hours of training from an institution approved by IRDA.

4. The applicant should not have violated any code of conduct mentioned in the regulations.

5. The applicant should have been declared "Fit and Proper" by the appropriate authority.
Net worth Requirements: The applicant must have share capital or contribution of not less than INR 50 Lakh.

Documents required for Corporate Agent Registration in India

1. Certificate of Incorporation or the LLP/Cooperative Society, Companies as per their respective administrative acts.
2. Details of the proposed or existing branch offices.

3. Details of the principal officer of the applicant organization.

4. Details of the directors/partners of the applicant organization

5. Organizational chart with functional responsibilities of each department.

6. Applicant’s Net-worth Certificate by a Chartered Accountant.

7. Fit and Proper Criteria Declaration

8. Receipt of the application fee

Other Conditions

The applicant needs to satisfy these criterions as prescribed for the corporate agency license as below:

Not disqualified under any law in force. Possess proper office space, equipment and trained workforce on their rolls to fulfil its activities effectively.

The Principal Officer is a graduate and receive minimum 50 hours practical training as per the requirements of authority.

The Principal Officer and Employees have not violated the code of conduct as authority prescribes for securing the agency license during the last three years.

Arm’s length relationship between financial matters of other business and corporate agency business where applicant has a business not related to insurance.

FIT and PROPER Criterion must be satisfied for the Key Management Personnel.

Process Of Corporate Agent Registration In India

The process of registering the corporate agents with IRDAI for acting as only insurance intermediaries are as follows:

1. Document preparation.

2. Filing the application in the online mode and paying the requisite application fee.

3. Complying to the additional demands of the IRDAI (if the authority asks for them)

4. Acquiring the Certificate of registration for the corporate agent.

FAQ - Corporate Agents

IRDAI (Registration of Corporate Agents) Regulations, 2015 issued by the Authority on Registration of corporate agents will be effective from which date?

These Regulations came into force on 01-04-2016.

a. Corporate Agents – Fee Structure:

b. Ans : Non-Refundable Fee – Rs.10,000

b.i. Registration Fee for issue of Certificate of Registration (COR) – Rs. 25000

b.ii. Renewal Fee for Renewal of COR – Rs. 25000

b.iii. Fee for issue of Certificates for Principal Officer/Specified person/Authorized Verifier – Rs. 500/-

b.iv. Late fee for renewal of CA COR – Rs. 750/-

Whether the application under New Regulations to obtain Certificate of Registration (COR) has to be made by the applicant directly to the Authority without any involvement of insurer?

Yes. All applications made under IRDAI (Registration of Corporate Agents) Regulations, 2015 should be submitted directly to the Authority by the applicants the online mode.

Capital Requirement for a Corporate Agent exclusively doing insurance intermediation – How it will affect the existing CA exclusively doing insurance business?

As per the New Regulations, a Corporate Agent exclusively doing insurance intermediation should have a minimum share capital or contribution and net worth of Rupees Fifty Lakh and it should be maintained a net worth of Rupees Fifty Lakh at all times. The Existing Corporate Agents exclusively doing insurance intermediation, also will have to be compliant with New Regulations before applying for obtaining Certificate of Registration in order to carry out their activities continuously w.e.f. 01.04.2016.

Whether submitting Board approved open architecture policy is mandatory even if the corporate agent wishes to have single tie-up or is required only for multiple tie-up?

Yes. Every corporate agent shall file, at the time of seeking registration, with the Authority, a Board or its equivalent Approved Policy on the manner of soliciting and servicing insurance products. The Policy, amongst others, shall include the approach to be followed by the corporate agent in having single or multiple tie-ups, the partners in the tie-ups, the business mix, the type of products sold, grievance redressal mechanism and reporting requirements.

Who conducts the training and examination for Principal Officers/Specified Persons/Authorized Verifiers?

Online training will be conducted by the Insurance Institute of India, Mumbai and online examination will be conducted by NSEIT. Website of Insurance Institute of India (III) – www.insuranceinstituteofindia.com. What is the procedure of transfer of Specified Persons? How is such transfer to be affected on the IRDAI portal?

What is the procedure of transfer of Specified Persons? How is such transfer to be affected on the IRDAI portal?

Every SP/PO desiring to transfer his/her certificate to the other corporate agent shall do so only after obtaining no objection certificate from the transferor corporate agent as per the procedure prescribed in the Regulation. In case the transferor corporate agent fails to issue NOC within 30 days of the date of application, it will be deemed that the NOC is issued and they do not have any objection for the proposed transfer.

Post 1st April, 2016, is there any requirement for insurer to conduct onsite inspection of CAs?

NO. As per Regulation 27, the Authority has the power to inspect the records of a Corporate Agent and performance of its activities anytime and in case of any deficiency observed, the Authority may take appropriate disciplinary action. The procedure applicable for the Inspection and the Audit of a Corporate Agent are mentioned in Schedule IV of these Regulations.

What are all the things that should be provided in Board Approved Policy required under Reg. 20 (1)?

The Board or equivalent approved policy shall contain the approach to be followed by the corporate agent in having Single or Multiple tie-ups, the proposed partners in the tie-ups, the business mix, the type of products sold, grievance redressal mechanism and the reporting requirements. The corporate agents after registration can enter into agreement with insurers for solicitation and distribution of their products and this should be disclosed to the Authority within 30 days of entering into such agreements. However, the board approved policy can be exhaustive and contain all other matter which they deem fit and necessary for registration and functioning of corporate agency.

What type of registers shall be maintained by the Corporate Agents and the format of the same?

In accordance with Regulation 30, every corporate agent shall maintain following registers in the prescribed formats. Register of Client Details: Name of the Client; Contact Address; Mobile Number; Policy Type; Policy Number; Premium Amount; Date of Commencement; Plan and Term; Sum Assured; Renewal details. Register of Complaints: Name of the Complainant; Nature of Complaint; Date of Complaint; Policy Number; SP details; Action taken details. Register of Specified Persons/Authorized Verifiers: Name; Address; Telephone NO.; Photograph; Date of Commencement of employment; Date of leaving service; Monthly Remuneration.

Can a specified person work for more than one insurer?

Yes, as per Reg. 3, Corporate Agents may have arrangements with a maximum of three life, three general and three health insurers to solicit, procure and service their insurance products and the Specified Person can work for all the insurer/s with whom they have tied up, provided the Specified Person has certificate for the respective line of business (Life/General/Health). Eg.: Specified Person (SP) having certificate to act as SP for Life business can work for life insurers only with whom CA is tied up. 12. As per Reg. 14 (iv) the corporate agent has to take adequate steps for redressal of grievances of its clients within 14 days of receipt of such complaints and keep the Authority informed about the number, nature and other particulars of the complaint.

Whether such complaints need to be logged in Insurer's grievance redressal system as well which is integrated with IGMS?

The complaints received by the Insurer should be logged in their grievance redressal system as well which is integrated with IGMS . However, both CA and the Insurer should have their internal mechanisms to consolidate all the complaints received at both ends & resolve the complaints with fair resolution to the Policyholder.

As the regulations requires mapping of all policies to SP’s for business sourced by them, how shall the mapping be done for cases wherein the policies are purchased directly by the Policyholders online?

For the policies purchased by the policyholders through online will be treated as DIRECT BUSINESS and the corporate agency code can be tagged. 14.

Is there any time frame within which the Corporate Agent needs to have tie up with the Insurer?

As per Reg. 23 (a) Corporate Agents registered under these regulations shall have to enter into arrangements with insurers for distribution of their products. These arrangements shall have to be disclosed to the Authority within 30 days of entering into such arrangements. The minimum period of such arrangement shall be for one year.

What are all the Returns/Certificates to be submitted to the Authority?

By the Corporate Agent: As per Reg 20 (2), the corporate agents have to furnish half-yearly returns to the Authority insurer-wise business placed separately in respect of life, general and health insurance, in the formats specified by the Authority, before 31st October and 30th April every year As per Reg 21 (ii), where the insurance is sold as an ancillary product along with a principal business product, the corporate agent or its shareholder or its associates shall not compel the buyer of the principal business product to necessarily buy the insurance product through it. The Principal Officer and CFO (or its equivalent) of the corporate agent shall file with the Authority a certificate in the format given in the Schedule VIII on half-yearly basis, certifying that there is no forced selling of an insurance product to any prospect. By the Corporate Agent and Insurer: 3) As per Reg 31 (3), every insurer who is engaging the services of a corporate agent shall file with the Authority a certificate, separately for all such corporate agents, in the format given in the Schedule VIA to be signed by the CEO and CFO. A similar certificate from the Principal Officer and CFO (or its equivalent) of the corporate agent specifying the commission/ remuneration received from the insurer shall be filed with the Authority as given in Schedule VIB.

List of Corporate Agents – Where is it available?

The list of corporate agents registered with the Authority is available on the Authority’s official website “www.irda.gov.in”

Our Blog

Overview Meaning of Corporate Agency License Eligibility Criteria Documents Required Other conditions Process of corporate agent registration in india Frequently Asked Questions Blog

Corporate Agency License

Overview

Meaning of Corporate Agency License

Eligibility Criteria for Corporate Agent Registration in India

Documents required for Corporate Agent Registration in India

Other Conditions

Process Of Corporate Agent Registration In India

FAQ - Corporate Agents

Our Blog

Company

services

Website Visitors