Due to the high population and equally high vehicle count of India, auto accidents are getting common. Therefore, people are gearing up to safeguard their vehicles with auto insurance policies. It has enhanced the need for auto insurance brokers in India as currently, their numbers are low. Thus, in this article, you will know the procedure to become an Auto Insurance Broker in India.
Currently, there is no industry more fruitful than the insurance sector. Given more importance since the pandemic (I know these words are harsh), this sector is seeing unprecedented growth. And that evolution is so much that currently, there exists a vacuum in this domain – especially in an Auto insurance broker License.
And the reason is simple. Car insurance policies are often too complicated, and at times, too intertwined with the car sellers that people question their legitimacy. It has created a demand in the car insurance industry that you can fulfill.
Therefore, in this article, you will know everything that you need to know about becoming a car insurance broker in India.
The first thing to know is that for becoming any kind of insurance broker, you need to acquire knowledge of that insurance domain.
Your first task is to hire a mechanical engineer who can understand the mechanics of vehicles. He will be the one capable of assessing the nature of any damages when it’s time for your customer to claim insurance policies.
As per the IRDA regulations for the insurance broker license, only those with a company can apply for it. Other options that you have for the license are LLP or a cooperative society. However, if you want to keep your business fruitful and clients many, only opt for a private limited company.
Once you have someone in your company (and an insurance broker can only be a company) to act as the mechanical engineer to assess all the insurance damages, it is time to train the principal officer. The Insurance Regulatory Development Authority of India provides that training on its official website. Once the officer has completed 50 hours of training, he must sit in the insurance broker examination.
If the exams are cleared, the officer transcends into a principal officer – the person who will be responsible for overseeing all the tasks of your car insurance company.
The documents that you must furnish to encompass your qualifications, your business entity, your net worth, and the directors and shareholders that are part of your insurance broking company:
Make sure you have kept in mind the type of insurance broker you want as it decides your net worth, paid-up capital, and deposit requirements.
Now, we move towards the procedure to obtain the insurance broker license. Valid for three years, this
The license will allow you to start operating as an auto insurance broker.
Your car insurance license is actually general insurance with the category of “vehicles”. Other factors that you must keep in mind when you obtain the license is as follows:
To get a vehicle or car insurance license, you must follow the same path as you would with a general insurance license. However, make sure that you hire someone capable of overseeing your business operations properly. Any mistake can at best make you an irksome entity in the eyes of IRDA and at worst, make you lose your business.