BROKING RELATIONSHIP CHANNEL AND BROKING REGULATIONS IN INDIA

8/7/2019 BROKING RELATIONSHIP CHANNEL AND BROKING REGULATIONS IN INDIA

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BROKING RELATIONSHIP CHANNEL ANDBROKING RELATIONSHIP CHANNEL ANDBROKING REGULATIONS IN INDIABROKING REGULATIONS IN INDIA

Regulations means InsuranceRegulations means Insurance

Regulatory and Development AuthorityRegulatory and Development AuthorityInsurance Brokers)Regulations,2002.Insurance Brokers)Regulations,2002.


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PRESENTATION MAPPRESENTATION MAP

INTRODUCTIONINTRODUCTION

ROLE OF BROKING CHANNELSROLE OF BROKING CHANNELS

ROLE OF BROKERSROLE OF BROKERS

WHO CAN BE INSURANCE BROKERWHO CAN BE INSURANCE BROKER

TYPES OF BROKERSTYPES OF BROKERS

CAPITAL REQUIREMENTSCAPITAL REQUIREMENTS

KET NOTESKET NOTES

BIBLIOGRAPHYBIBLIOGRAPHY


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INTRODUCTIONINTRODUCTION

The insurance marketplace is undergoing aThe insurance marketplace is undergoing atransformation that may eventually lead totransformation that may eventually lead tosignificant changes in how consumerssignificant changes in how consumers

purchase insurance products. A variety ofpurchase insurance products. A variety ofdistribution channels are currently used indistribution channels are currently used inthis market place, and some insurersthis market place, and some insurersutilize a combination of distributionutilize a combination of distributionchannels. These include companychannels. These include company--ledledchannels, bankchannels, bank--led channels andled channels andBROKER channels.BROKER channels.


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ROLE OF BROKING CHANNELSROLE OF BROKING CHANNELS

Building faith about the company in the mind ofBuilding faith about the company in the mind ofthe client.the client.

Maintaining personal credibility with the clients.Maintaining personal credibility with the clients.

To become a effective financial advisor forTo become a effective financial advisor forclients.clients.

To provide best fit for the clients.To provide best fit for the clients.

To provide wide range of competitive productsTo provide wide range of competitive products

for individual customers.for individual customers. To become relaible advisor for both insuranceTo become relaible advisor for both insurance

companies and clients.companies and clients.


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ROLE OF BROKERSROLE OF BROKERS

Business development.Business development.

Client servicing.Client servicing.

Maintaining risk profile.Maintaining risk profile. Renewal of policies existing clients).Renewal of policies existing clients).

Providing hassle free guidance.Providing hassle free guidance.

Giving accurate judgment.Giving accurate judgment.


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WHO CAN BE INSURANCEWHO CAN BE INSURANCE

BROKERBROKERAn Individual.An Individual.

A firm.A firm.

A company formed under companies actA company formed under companies act1956.1956.

A coA co--operative society(1912).operative society(1912).

Any other person recognized by theAny other person recognized by theauthority to act as an Insurance broker.authority to act as an Insurance broker.


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Types of BrokersTypes of Brokers

DIRECT BROKERS:DIRECT BROKERS:

Acts between the end users and primary insurers only.Acts between the end users and primary insurers only.

FUNCTIONS:FUNCTIONS:

Obtaining detailed information of the clients business and riskObtaining detailed information of the clients business and riskmanagement philosophy.management philosophy.

Familiarizing with the clients business and underwritingFamiliarizing with the clients business and underwritinginformation.information.

Rendering advice on appropriate insurance cover and terms.Rendering advice on appropriate insurance cover and terms. Acting promptly on instructions from a client and providing himActing promptly on instructions from a client and providing him

written acknowledgements and progress reports.written acknowledgements and progress reports.

Providing services to insurance consultancy and risk management.Providing services to insurance consultancy and risk management.


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RERE--INSURANCE BROKERINSURANCE BROKER

Acts between primary insurers and reActs between primary insurers and re--insurers.insurers.


Rendering consultancy and risk managementRendering consultancy and risk managementservices for reinsurance.services for reinsurance.

Selecting and recommending a reinsurers or aSelecting and recommending a reinsurers or agroup of reinsurers.group of reinsurers.

Maintaining a database of available insuranceMaintaining a database of available insurancemarkets.markets.

Negotiate with a reinsurer on the clients behalf.Negotiate with a reinsurer on the clients behalf.


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COMPOSITE BROKERCOMPOSITE BROKER

Acts between both end users and primaryActs between both end users and primary

insurers and between primary insurers andinsurers and between primary insurers and

rere--insurers.insurers.


A composite broker shall carry out any oneA composite broker shall carry out any oneor more of the functions of direct brokeror more of the functions of direct broker

and reand re--insurance broker.insurance broker.


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CAPITAL REQUIREMENTSCAPITAL REQUIREMENTS

DIRECT BROKERDIRECT BROKER--50 lakhs50 lakhs

REINSURANCE BROKERREINSURANCE BROKER--200 Lakhs200 Lakhs

COMPOSITE BROKERSCOMPOSITE BROKERS--250 Lakhs250 Lakhs


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IMPORTANT ASPECTS OFIMPORTANT ASPECTS OF

BROKING REGULATIONSBROKING REGULATIONS Validity of license.Validity of license.

Renewal of license.Renewal of license.

Ceiling on business from single client.Ceiling on business from single client. Code of conduct.Code of conduct.

Professional indemnity insurance.Professional indemnity insurance.

Maintenance of books ofMaintenance of books ofaccount,records,etc.account,records,etc.


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BIBLIOGRAPHYBIBLIOGRAPHY

IRDA(INSURANCEIRDA(INSURANCE

BROKERS)REGULATIONS,2002.BROKERS)REGULATIONS,2002.

Insurance distribution channels(RandyInsurance distribution channels(RandyE.Dumm College of Business)E.Dumm College of Business)

Robert E.Hoyt(Faculty of RiskRobert E.Hoyt(Faculty of Risk

Management and Insurance)Management and Insurance)


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THANK YOU.THANK YOU.

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BROKING RELATIONSHIP CHANNEL AND BROKING REGULATIONS IN INDIA