Insurance Web Aggregator License Registration

Narendra Kumar

30 Mar, 2023

Insurance Web Aggregators are also known as Insurance Intermediaries. They are web aggregator or you may say a portal which gives a platform to various insurance products for its buying & selling.

Their functions include:

• Directing a perspective to the insurer’s website.
• Helps one to get through the sale process of the policy.
• Primary duty is to enable comparative
• Boosting the online market for several sorts of products

They provide with a listing of products & enable comparison analysis through following criteria’s:

• Amount involved
• Sum assured
• Premium blocks
• Eligible holder
• Term offered
• Feasibility of the scheme

What is the Main Objective?

Supervision & Monitoring of a website for providing customer interface to the insurance prospects in order to have the in-house analysis of pricing, product information along with other related matters.

What are the Concerned Regulations?

These Regulations are called the Insurance Regulatory and Development Authority of India (Insurance Web Aggregators) Regulations, 2017 which supersede the regulations issued in the year 2013. Also, fees norms according to this Insurance Regulatory and Development Authority of India (Payment of Commission or Remuneration or reward to insurance agents and insurance intermediaries) Regulations, 2016.

Any of the following can start working on modeling of an insurance web aggregator platform. It may be:

• A Company registered under Companies Act, 2013
• An LLP under Limited Liability Partnership Act, 2008
• Any other person recognized by the Act.
• MOA of the Company should cover it as the main object under its ambit.
• The applicant is not registered as an insurance agent, corporate agent, insurance marketing firm, micro insurance agent etc.
• Should not have a referral arrangement with Insurer.
• Applicant must have a fully equipped designed website for intermediation.
• Authority is of opinion that the grant of license is in the interest of the policyholders.

Application

An applicant seeking Insurance Web Aggregator License should make an application to authority in Form ‘A’ of Schedule I of the concerned regulations. It should be accompanied by draft refundable fees of 10000/- payable in favor of IRDAI Hyderabad or by recognized electronic fund transfer to IRDAI. However, applicants wanting to indulge themselves for outsourcing & telemarketing functions shall mention the same separately.

What are the Provisions Regarding Capital/Net Worth?

• Any such applicant seeking for this registration must have a minimum paid up capital of Rs. 25 Lacks.
• In case of a company it must be subscribed & issued fully by Equity shares but in case of LLP, it must be brought in cash by partner contribution.
• The aggregate holdings of equity shares or contribution of the Insurance Web Aggregator by foreign investors, including portfolio investors, shall not exceed forty-nine per cent of paid-up equity capital of Insurance Web Aggregator at any time or such foreign investment limit as prescribed by the Central Government.
• The net-worth of an Insurance Web Aggregator shall at no time during the period of Certificate of registration period fall below 100% of the minimum capital requirements or contribution.

Validity

The Certificate of Registration shall be valid for 3 years from issuance date unless the same is suspended or canceled.

What are the essentials?

• It should have a Board approved the policy on the manner of soliciting insurance products.
• Mechanisms should be designed for enabling multiple tie-ups, Types of policies, Grievance redressal regime, compliance requirements etc.
• Every web aggregator shall maintain a professional indemnity cover or insurance throughout the validity for a period of registration.
• An Insurance Web Aggregator shall not offer any rebate or discount or any other inducement to the prospect which will be a violation of Section 41 of the Insurance Act, 1938.
• Details pertaining to arrangements made by the aggregator with aligned insurers must be mentioned in the format prescribed.
• No Insurance Web Aggregator shall promote or push a particular product of a particular company either through its website or through distance marketing approaches.

What are the compliance requirements?

• The Insurance Web Aggregators shall furnish half-yearly returns to the Authority insurer-wise business placed separately in respect of life, general and health insurance, in the formats specified by the Authority, before 31^st October and 30th April every year.
• The Principal Officer of Insurance Web Aggregator shall submit to the Authority, at the end of each financial year, a certificate confirming that the Insurance Web Aggregators has complied with all the provisions of these Regulations during the concerned financial year.

Activities are undertaken

• Sale of Insurance products online by web aggregator medium.
• Display of product comparisons on the website.
• Transmission of leads to insurers aligned with
• Sale of insurance products by Tele-marketing mode or distance marketing activities.

Documentation

• COI, MOA & AOA of the Company or Agreement in case of LLP.
• List of major shareholding (5% or more of shareholding)
• Particulars of Directors / Designated Partners in case of LLP
• Name & activities of associated / interested companies.
• Name & addresses of Principal Bankers of the applicant
• Name & address of statutory auditors.
• Organizational chart shoeing inflows & outflows.
• Particulars of KMP associated with the concern.
• 3 years business plan with projection reports.
• Particulars of website proposed to be used or designated (Proof of registration of the domain name
• 3 years audited annual accounts
• Copy of PAN Card & GST Certificate of the company
• Details of settled or pending disputes if any.
• Net worth Certificate by a Chartered Accountant.
• Training & Examination Certificate of Principal Officers& authorized verifiers.
• A User ID & Password to verify the aggregation website in a closed cover.

Also Read: Insurance Web Aggregator Legal Support