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Procedure for becoming an insurance agent in India

The Insurance Act, 1938 lays down that an insurance agent must possess a license under Section 42 of that Act. The license is to be issued by the IRDA. The IRDA has authorized designated persons, in each insurance company, to issue the licenses on behalf of the IRDA. The fee for the license, the manner of making an application, etc., have been described in the IRDA Regulations. A license issued by the IRDA will be valid for three years. The license may be to act as an agent for a life insurer, for a general insurer or as a "composite insurance agent" working for a life insurer as well as a general insurer. No agent is allowed to work for more than one life insurer or more than one general insurer.

The qualifications necessary before a license can be given are that the person (individual or corporate insurance executive) must

• be at least 18 years old
• have passed at least the 12th standard or equivalent examination, if he is to be appointed in a place with a population of 5000 or more, or 10th standard otherwise
• have undergone practical training for at least 100 hours in life or general insurance business, as the case may be, from an institution, approved and notified by the IRDA. In the case of a person wanting to become composite insurance agent, the applicant should have completed at least 150 hours practical training in life and general insurance business, which may be spread over six to eight weeks.
• have passed the pre-recruitment examination conducted by the Insurance Institute of India or any other examination body recognized by the IRDA.

A person with the following disqualifications is debarred from holding a license

• He has been found to be of unsound mind by a court of competent jurisdiction
• He has been found guilty of criminal breach of trust, misappropriation, cheating, forgery or abetment or attempt to commit any such offence.

The license once issued, can be cancelled whenever the person acquires a disqualification. Applications for renewal have to made at least thirty days before the expiry of the license, along with the renewal fee of Rs. 250. If the application is not made at least thirty days before the expiry, but is made before the date of expiry of license, an additional fee of Rs.100 is payable. If the application is made after the date of expiry, it would be normally be refused. Prior to renewal of the license, the agent should have completed at least 25 hours practical training in life or general insurance business or at least 50 hours practical training in life and general insurance business in the case of a composite insurance agent. Insurers who select agents for appointment, make arrangements for training, for appearing in the prescribed examinations, and obtaining the license from the IRDA. The procedures have been streamlined and there is little loss of time for any step in the process.

Disclaimer: This information was obtained from the insurance-solutions information website.

Insurance Agent as a Profession    

List of Companies in need of Insurance Agents