In the insurance industry, many companies sell different insurance products such as health insurance, life insurance, and general insurance. Each insurance type, they have multiple policies to cover the unique needs of the policyholder. Finding the right policy is time-consuming and hectic for many, so they take assistance from an insurance broker. And the broker required a license to provide the insurance services legally. In the article, the advantages of having a license for a broker are shared.
What is an Insurance Broker License?
An insurance broker represents consumers who are looking for a policy in health insurance, life insurance and general insurance. They can sell policies from different insurance companies and earn a commission, but to sell the policies they must have a license. The insurance brokers of three categories required a license as Direct Broker, Reinsurance Broker, and Composite Broker.
The following can be registered for the insurance broker license:
- Company established under the Companies Act 2013 or Company Law 1956
- Partnership that is registered under the Limited Liability Partnership Act 2008
- Cooperative society is registered under the Co-operative Society Act of 1912
- Any other individual or company that is allowed to conduct business related to an Insurance Broker.
Benefits of an Insurance Broker License
The following are the benefits of an insurance broker license:
Give Legal Status
By taking an insurance license, an insurance broker is registered with the government legally. After registration, the broker has to follow all the compliances set by the IRDAI and work transparently, as per the code of conduct. Having a license will
Access to Multiple Insurers
Through license, the broker represents customers and has the authority to offer different policies from insurers. An insurance broker can set up different sale contracts with multiple companies by providing them the customers and increasing their income.
By having access to a wide range of insurance products, they can attract customers who have different needs, as they can offer a policy as per the customer’s requirement. This will increase the sales of insurance brokers as compared to insurance agents who work with only one insurance company and get a fixed salary.
Create a Unique Sales Strategy
The insurance brokers work for themselves and they don’t have to follow fixed rules and strategies. So, by having freedom in making decisions, they can create different sales strategies to maximise sales and revenue. The brokers must follow the rules and should not promote anything misleading or offensive.
Everything which is shared must be as per the bylaws and contract. In the technique for selling policies, the broker can use online channels to sell insurance products. But the conduct of the sales campaign and Ads must be under the law.
Customised Solutions
The insurance broker gets the license after qualifying for the exams, so they know the industry and insurance products. For comparing multiple policies, brokers will help you the best as they have experience and knowledge in handling the needs of clients. As stated above, they have access to various insurance products, so they can offer you a customised policy as well.
How did Insurance Brokers help?
- By having the expertise in the insurance market provide the best coverage at the best price.
- Advise the best advice for your unique insurance needs and suitable coverage.
- Work with selected groups of companies regularly, to help customers secure discounts in premiums.
- The service of a broker does not cost extra, as they charge a commission from the insurance provider. No need to pay extra over your premium.
- Saves time in policy research, negotiating premiums, claim assistance and much more.
The insurance broker is a person in between the insurer and the insured, who takes a commission on selling each policy. To provide the service the broker, must have a license also the trust of customers. Read more content on RegistrationKraft about Insurance and IRDAI.