Corporate Agent License is the permission issued by the IRDA bodies seeking to solicit and procure insurance policies and services on behalf of insurers. In this article, we discuss the 9 conditions for this license.
A corporate agency is a cooperative society or a business entity with the authorization from the IRDA to get and deal with insurance policies on behalf of insurance companies. Obtaining this permission hinges on adherence to certain terms and conditions.
Without agreeing to follow these conditions, a corporate agent wont’ be issued the authorization to initiate its operation.
Condition 1: Corporate Agency must only provide services mentioned in the regulation
Corporate Agency can’t engage with diverse businesses within the insurance sector. There are four types of corporate agents in insurance and IRDA regulations states that an agent can only provide services specified in its respective category:
- General Insurance corporate agent can only solicit and procure general insurance services.
- Life insurance corporate agent is allowed to only deal in life insurance policies.
- Health insurance corporate agent can only engage with health insurance services.
- A composite insurance agent has the most flexibility. It can provide services for general, life and health insurance.
Condition 2: The corporate agent must adhere to all the IRDA regulations
Corporate agent must have to act according to the Insurance Regulatory and Development Authority Act, 1999. However, the compliance doesn’t end here. Those with the corporate agent approval must also adhere to the other regulations, guidelines and amendments that IRDA introduces from time to time.
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Condition 3: Informing the IRDA of any mistake made in the Corporate agency license application
If the corporate agent has been issued the IRDA license based on the information that is later found to be wrong, then it’s the duty of the licensee to inform the IRDA of said mistake. If IRDA finds out about this discrepancy later, it will issue a show cause notice to the licensee – prompting investigations that can only harm the corporate agent.
Condition 4: Addressing the complaints of the client
The corporate agent must take adequate steps to address the grievances of the customers. It has to do so within 14 days of receiving the complaints, and it must keep the IRDA updated about the nature, number and other information about the issue.
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Condition 5: Corporate agent must only keep reasonable number of Insurance policies
A corporate agent must only keep a reasonable number of insurance policies that it can handle based on its corporate infrastructure, technical infrastructure and manpower.
Condition 6: Maintaining the records as prescribed by the IRDA
The Corporate agency must maintain a record in the format prescribed by the IRDA. That record should entail person wise and policy wise details of the all the insurance policies in a simple and comprehensible format. Furthermore, the agency must implement a system by which the corporate agent can access these required whenever they so need.
Condition 7: No multi marketing
No corporate agent must make any efforts towards multi-marketing to procure insurance clients. Doing so is an act of contravention of the IRDA regulations that can further create issues for the corporate agency.
Condition 8: All members must act according to the Code of Conduct
All the members within the corporate agency should adhere to the code of conduct specified by the Insurance Regulatory and Development Authority of India.
Condition 9: Maintaining a separate books of accounts
The Corporate Agents must refer to regulations 31 to maintain a separate books of accounts for their business.
Corporate Agent License comes with many conditions that the licensee must adhere to. Not following these compliances can cause distrust among the IRDA officials and can further cause cancellation of the IRDA license.
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There are conditions you must meet if you want to retain your corporate agency license. Know about these 9 conditions to continue operating your insurance business.