VENTURE OF VIMABHARAT GENERAL INSURANCE BROKING PVT LTD

PROJECT REPORT FOR VIMABHARAT GENERAL INSURANCE BROKING

PRIVATE LIMITED

GENERAL INSURANCE BROKING BUSINESS PLAN

F.Y. 24-25
ZUBAYR ALI SHAIKH

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 Table of Contents

Executive Summary 4

Mission & Vision 6

Unique Selling Proposition 8

Business Description 9

Business Model for GI Broker in India 11

Market Analysis 13

Products & Services 19

Marketing & Sales Strategy 23

Operations Plan 27

Management & Organization 29

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 Table of Contents

Management & Organization 31

Financial Plan 34

Conclusion 43

Insurance Broker Regulations 44

Glossary 47

Disclaimer 48

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 EXECUTIVE SUMMARY

Quick overview of the General Insurance Business -

In the world of insurance, general insurance brokers act
as intermediaries between insurance companies and
clients seeking coverage for Life & Non-life events. Here's
a concise breakdown of their business:

 Connecting Clients and Coverage: General

insurance brokers don't sell their own insurance products.
Instead, they work on behalf of clients to identify their
specific insurance needs and risk profile.

 Market Comparison and Expertise: Brokers have

access to a wide range of insurance products from various
companies. They leverage their knowledge of the market
to compare options and find the best coverage and deals
for their clients.

 Advocacy and Support: Beyond product selection,

brokers offer ongoing support throughout the insurance
lifecycle. This includes assisting with claims processing,
ensuring clients receive fair compensation when needed.

In essence, general insurance brokers help bridge the gap

between complex insurance products and individual
needs. They act as trusted advisors, simplifying the
process and advocating for clients in a sometimes-
overwhelming insurance landscape.

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 EXECUTIVE SUMMARY

Health, motor and crop insurance to drive growth

 Customers can now pay their health insurance premium in
instalments. Earlier, health insurance companies used to collect
the insurance premiums from customers on annual basis.
 Strong growth in the automotive industry over the next decade
will be a key driver of motor insurance.
 Crop insurance segment contributed 13.91% to gross direct
premiums of non-life insurance companies in FY22 until
January 2022.

Rapidly growing insurance segments

 In the past five years, the total number of lives covered nearly
doubled from 12 crore to 23 crores, and the non-life segment
welcomed six new entrants, taking the total number of players
to 34.

Increasing private sector contribution

 The market share of private sector companies in the general
and health insurance market increased from 48.03% in FY20 to
49.31% in FY21.
 The government has made FDI laws easier for the insurance
sector, raising the FDI limit from 49% to 74%

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 MISSION
To empower individuals and businesses in India to navigate the
complexities of general insurance with confidence.

This mission statement emphasizes our commitment to:

 Client Education: Equipping clients with the

knowledge and understanding to make informed
insurance decisions.

 Needs-Based Approach: Tailoring insurance

solutions to each client's specific risk profile and
requirements.

 Client Advocacy: Acting as a trusted advisor and

championing clients' interests throughout the
insurance process.

 Simplified Experience: Streamlining the

insurance selection and claims process for a
hassle-free experience.

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 VISION

To be the leading independent general insurance broker in India,

recognized for exceptional client service, innovative solutions, and
unwavering commitment to financial security.

This vision statement outlines our long-term aspirations, including:

 Market Leadership: Establishing your brokerage

as the preferred choice for clients seeking general
insurance solutions in India.

 Client-Centric Culture: Building a reputation for

exceptional customer service that prioritizes client
needs and satisfaction.

 Innovation and Growth: Continuously seeking

new ways to improve services, expand product
offerings, and adapt to the evolving insurance
market.

 Financial Security Champion: Becoming a

recognized advocate for financial security,
empowering clients to protect themselves and their
assets against unforeseen events.

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 UNIQUE SELLING PROPOSITION (USP)

USP

We bridge the gap between complex insurance and client’s peace of

mind. As the trusted insurance partner, for our clients we go beyond just
finding a policy. We offer a personalized approach, combining in-depth
market knowledge with exceptional client service to ensure to have the
right coverage, at the best value, with unwavering support every step of
the way.

Our USP emphasizes these key differentiators:

 Personalized Approach: You don't just sell policies; you take the
time to understand each client's unique needs and risk profile.

 Client Education: You empower clients with knowledge, fostering trust

and informed decision-making.

 Market Expertise: You leverage your in-depth knowledge of the market

to secure the best coverage and deals for clients.

 Exceptional Service: You prioritize client satisfaction, offering

ongoing support and advocacy throughout the insurance lifecycle.

We have a clear and concise USP that resonates us with

our target audience & effectively differentiate our self from
competitors in the general insurance market.

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 BUSINESS DISCRIPTION

Overview of the General Insurance Industry in India -

The general insurance industry in India plays a crucial role in risk mitigation and
financial protection for individuals and businesses. Here's a breakdown:

Market Size and Growth:

 India's general insurance industry is the 10th largest globally and the 2nd
largest in emerging markets (as of 2022).
 It's experiencing steady growth, with a projected CAGR (Compound Annual
Growth Rate) of 7.1% for total premiums over the next five years.
 This growth is driven by factors like:
o Increasing economic activity
o Expanding middle class with rising disposable income
o Growing awareness of risk management
o Government initiatives promoting insurance penetration

Market Structure:

 The Indian general insurance market is a mix of public and private players.
 Public sector insurers (like National Insurance Company) held a significant
market share historically, but private players are gaining ground.
 As of March 2024, there were 29 private general insurance companies
operating in India.

Product Landscape:

 General insurance covers a wide range of risks, including:

o Property insurance (home, buildings)
o Motor insurance (cars, bikes)
o Health & Personal accident insurance (individual, group)
o Marine insurance (cargo, ships)
o Liability insurance (professional, product)
o Cyber insurance etc. Etc...

Distribution Channels: Insurance is traditionally sold through agents, but other

channels are gaining traction:

o Brokers: Offer unbiased advice and compare policies from different

companies.
o Bancassurance: Banks partner with insurers to sell insurance products.
o Direct Sales: Companies sell directly through online platforms or
telemarketing.

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 BUSINESS DISCRIPTION

Current Trends in the General Insurance Industry in

India -
 Digitalization: The industry is rapidly adopting digital technologies for
policy issuance, claims processing, and customer service.
 Focus on Microinsurance: Making insurance accessible and
affordable for low-income populations through microinsurance products.
 Usage-Based Insurance (UBI): Tailoring premiums based on
individual driving habits or health conditions (e.g., pay-as-you-drive for motor
insurance).
 Focus on Customer Experience: Insurers are prioritizing
customer experience by offering simpler products, faster claims settlement,
and improved communication channels.
 Regulatory Developments: IRDAI (Insurance Regulatory and
Development Authority) is introducing regulations to promote healthy
competition, improve product standardization, and protect consumer interests.

Challenges:
 Low Insurance Penetration: Despite growth, India's general
insurance penetration (premium as % of GDP) remains lower compared to
developed economies.
 High Claim Ratios: High claim ratios can put pressure on profitability
for insurers.
 Cybersecurity Threats: The increasing reliance on technology
makes the industry vulnerable to cyberattacks.

Conclusion:
Overall, the general insurance industry in India is poised for continued
growth, driven by a combination of economic factors, regulatory support,
and technological advancements. By addressing challenges like low
penetration and adapting to evolving trends, the industry can play a vital
role in India's economic development and financial inclusion.

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 BUSINESS MODEL

HOW IS GENERAL INSURANCE BROKERS BUSINESS OPERATES

& GENERATE REVENUE?

Value Proposition:
 Client Focus: As a general insurance broker, you act as an intermediary
between clients and insurance companies. Unlike agents who represent
specific companies, you prioritize finding the best coverage and rates for your
client's specific needs.
 Expertise & Risk Assessment: You offer expertise in analysing client risks,
comparing insurance products from various insurers, negotiating premiums,
and assisting with claims filing.
 Convenience & Streamlined Process: You simplify the insurance buying
process for clients, saving them time and effort in researching and comparing
policies.

Target Market:
 Individuals seeking personal insurance (e.g., property, auto, health)
 Small and Medium Enterprises (SMEs) requiring business insurance (e.g.,
property, liability, cyber)
 Large corporations with complex insurance needs

Revenue Streams:
 Commissions: Your primary income comes from commissions paid by
insurance companies for policies sold through your brokerage. The
commission rate varies depending on the type of insurance and the insurer.
 Fees: You may offer additional fee-based services such as risk consulting,
claims management assistance, or customized insurance policy reviews.

Cost Structure:
 Operational Costs: This includes rent, salaries, marketing expenses,
technology costs (e.g., CRM software), and professional indemnity insurance.
 Licensing and Regulatory Fees: You'll need to pay fees for obtaining and
maintaining your insurance broker license from IRDAI.
 Training & Development: Investing in ongoing training for your team ensures
they stay updated on insurance products and regulations.

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 BUSINESS MODEL
Marketing & Sales Strategy:
 Develop a strong online presence: Create a user-friendly website that
provides information about your services and allows clients to get quotes.
Utilize social media platforms to connect with potential clients and build brand
awareness.
 Network with potential clients: Attend industry events, partner with local
businesses, and build relationships with financial advisors or other
professionals who might refer clients to you.
 Content marketing: Create informative content (blogs, articles, webinars) on
insurance topics to educate potential clients and establish yourself as a
thought leader.

Key Success Factors:

 Building strong relationships: Focus on building trust and long-term
relationships with clients by providing exceptional service and personalized
attention.
 Offering a comprehensive range of services: Cater to a variety of client
needs by offering a wide range of insurance products and services.
 Staying informed: Keep up-to-date with the latest insurance products,
market trends, and regulatory changes.
 Technology adoption: Utilize technology to streamline processes, improve
efficiency, and enhance client experience.

Challenges:
 Competition: The insurance broking industry is competitive. You'll need to
differentiate yourself by offering a unique value proposition and excellent
customer service.
 Client acquisition: Attracting new clients requires effective marketing
strategies and building trust.
 Regulatory compliance: Ensure you adhere to all IRDAI regulations and
maintain a high ethical standard.

Conclusion:
By focusing on client needs, offering a comprehensive service package,
and staying informed, a general insurance broker in India can build a
successful business model. Remember, building trust and strong
relationships with clients is paramount for long-term success.

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 MARKET ANALYSIS

Who are the potential clients (demographics, businesses,

etc.)?
The target market for general insurance brokers in India is quite broad and can be
segmented into two main categories: Individuals and Businesses. Here's a
breakdown of potential clients for each:

Individuals:
 Demographics:
o Age: Young adults (25-40 years old) entering the workforce and
starting families.
o Income level: Middle class and above with disposable income to invest
in risk management.
o Location: Urban and semi-urban areas with higher insurance
awareness.
o Digital Savvy: Individuals comfortable researching and purchasing
insurance online.
 Insurance Needs:
o Personal accident insurance
o Health insurance (individual and family plans)
o Motor insurance (cars, two-wheelers)
o Property insurance (home, valuables)
o Travel insurance

Businesses:
 Business Types:
o Small and Medium Enterprises (SMEs) across various sectors
(manufacturing, retail, services)
o Large corporations with complex insurance needs
 Insurance Needs:
o Property insurance (buildings, machinery)
o Business interruption insurance
o Liability insurance (product, professional)
o Marine insurance (for businesses involved in imports/exports)
o Cyber insurance
o Group health insurance for employees

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 MARKET ANALYSIS

Additional factors to consider:

 Risk Profile: Clients with higher risk exposure (e.g., businesses operating
in hazardous environments) will be more likely to seek personalized advice
from a broker.

 Insurance Awareness: Individuals and businesses with limited insurance

knowledge may benefit from a broker's expertise in navigating complex
products and regulations.

 Convenience: Busy professionals and individuals may value the time-

saving advantage a broker offers by handling insurance research,
comparison, and policy procurement.

Untapped Potential:
 Micro, Small and Medium Enterprises (MSMEs) represent a significant
untapped potential for brokers. Many MSMEs lack awareness of the benefits
of insurance and can be persuaded by brokers to adopt appropriate coverage.

 Rural markets also hold promise, with growing disposable income and
increasing awareness of financial products. Brokers can develop strategies to
reach these markets through local partnerships or targeted marketing
campaigns.

By understanding these target markets and their specific needs, general

insurance brokers in India can tailor their services and marketing strategies to
effectively reach potential clients and achieve business growth

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 MARKET ANALYSIS

Competitor Analysis: Direct and Indirect Competitors for

General Insurance Brokers in India

General insurance brokers in India face competition from various players in the
market. Here's a breakdown of direct and indirect competitors:

Direct Competitors:

 Other Insurance Brokers:

o There are numerous licensed general insurance brokers in India, both
established national players and regional firms.
o The competition focuses on offering the best combination of:
 Competitive quotes and policy options from various insurers.
 Excellent customer service and personalized advice.
 Strong industry expertise and risk management knowledge.
 Efficient claims assistance.

Strategies to beat them:

Specialization: Focus on a specific niche market or develop expertise in a particular

insurance category (e.g., cyber insurance for SMEs).
Technology adoption: Utilize technology to streamline processes, provide faster quotes, and
offer a superior online experience.

Value-added services: Go beyond basic broking by offering risk assessment, claims

management assistance, or customized insurance reviews.
Building strong relationships: Cultivate long-term relationships with clients through
exceptional service and proactive communication.

Indirect Competitors:
 Insurance Companies:
o While brokers represent clients, insurance companies have their own
sales channels:
 Direct Sales: Many insurers sell policies directly through their
websites or telemarketing teams.
 Bancassurance: Partnerships between banks and insurers
allow for insurance products to be sold at bank branches.
 Agency Network: Insurance companies have their own network
of agents who promote and sell specific company policies.

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 MARKET ANALYSIS
 Challenges from Insurers:
o Insurance companies may offer lower premiums or bundled deals to
attract clients directly, bypassing brokers.
o They may have a larger marketing budget and brand recognition
compared to individual brokers.
 Strategies to compete:
o Focus on unbiased advice: Highlight the advantage of brokers who
compare policies across multiple insurers to find the best fit for the
client's needs.
o Personalized service: Emphasize the personalized attention and risk
management expertise brokers provide compared to a one-size-fits-all
approach by some insurance companies.
o Niche expertise: Brokers can develop in-depth knowledge of specific
insurance categories, offering a level of specialization that some direct
sales channels might lack.

Other Indirect Competitors:

 Online Aggregators:
o Websites that allow users to compare insurance quotes from various
companies directly.
o While convenient for price comparison, they may not offer personalized
advice or in-depth product knowledge.
 Fintech Start-ups:
o Emerging insurtech start-ups are leveraging technology to simplify
insurance buying and claims processes.
o Brokers can stay ahead by adopting similar technologies and focusing
on building trust and long-term relationships with clients.

Competitive Landscape Summary -

The general insurance broking industry in India is a competitive space.
By understanding competitors' strengths and weaknesses, you can
develop strategies to differentiate yourself and attract clients. Focus on
offering a unique value proposition, personalized service, and expertise
that sets you apart from direct sales channels and online platforms.
Building strong client relationships and staying informed about industry
trends will be crucial for success.

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 MARKET ANALYSIS

Market Need:
General insurance brokers in India address several
specific needs that individuals and businesses might have
when it comes to insurance:

For Individuals:
 Finding the Right Coverage: Individuals may not have the time or expertise
to research and compare different insurance policies from various companies.
Brokers can analyse their needs and recommend the most suitable coverage
at a competitive price.
 Understanding Complex Products: Insurance products can be intricate with
various clauses and exclusions. Brokers can explain the finer details of
policies, ensuring clients understand what they're buying.
 Personalized Service: Brokers offer personalized attention, tailoring
recommendations to individual risk profiles and financial situations.
 Negotiating Premiums: Brokers can leverage their relationships with
insurers to negotiate better premiums for clients.
 Claims Assistance: During a claim situation, brokers can guide clients
through the process, ensuring a smooth and hassle-free experience.

For Businesses:
 Risk Management Expertise: Brokers can help businesses identify potential
risks and develop a comprehensive insurance strategy to mitigate them.
 Tailored Insurance Solutions: Businesses have complex insurance needs
that may require customized solutions. Brokers can design insurance
packages that address specific business risks.
 Cost Optimization: Brokers can help businesses compare quotes from
various insurers and find the most cost-effective coverage without
compromising on necessary protection.
 Streamlined Processes: Brokers can handle policy renewals, manage
multiple insurance policies for a business, and save them time and effort.
 Risk Management Consulting: Some brokers offer additional services like
risk management consulting, helping businesses develop safety programs
and loss prevention strategies.

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 MARKET ANALYSIS

Overall Market Needs Addressed:

 Convenience: Brokers simplify the insurance buying process for both
individuals and businesses.

 Expertise & Knowledge: They offer valuable expertise in navigating the

insurance landscape, understanding complex products, and making informed
decisions.

 Unbiased Advice: Brokers represent the client's best interests, not a

specific insurance company.

 Negotiation Power: They can leverage their relationships with insurers to

negotiate better premiums or policy terms.

 Claims Support: Brokers offer guidance and assistance during the claims
process, ensuring clients receive fair compensation.

By addressing these specific needs, general insurance

brokers play a crucial role in promoting risk
management, financial protection, and peace of mind for
individuals and businesses in the Indian market.

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 PRODUCTS & SERVICES
Insurance Products Offered –

For Individuals:
 Personal Accident Insurance: Provides financial compensation in case
of accidental death, permanent or temporary disability, or medical expenses
arising from an accident.

 Health Insurance: Covers medical expenses incurred due to

hospitalization, surgeries, and illnesses. Options include individual health
insurance plans, family floater plans (covering spouse and dependent
children), and critical illness plans.

 Motor Insurance (Mandatory for all vehicles in India):

o Third-Party Liability Insurance: This basic coverage is mandatory
and provides financial protection for any injuries or property damage
caused to a third party during an accident.
o Comprehensive Insurance: Offers broader coverage compared to
third-party only. It protects your vehicle against theft, fire, natural
disasters, and self-inflicted damage (accidental collision) in addition to
third-party liabilities. You can also opt for add-on covers for engine
protection, depreciation reimbursement, and more.

 Property Insurance: Protects your home and its contents against fire,
natural disasters (earthquake, floods), theft, and other specified perils. You
can choose from various building sum insured options and consider add-on
covers for jewellery, valuables, and riots or strikes.
 Travel Insurance: Provides financial protection for medical emergencies, trip
cancellations, baggage loss, flight delays, and other unforeseen events while
traveling domestically or internationally. Different plans offer varying coverage
depending on the trip duration and destination.
 Home Contents Insurance: Protects your belongings inside your home in
case of theft, fire, or other insured perils. This can be helpful if your property
insurance doesn't cover the contents.

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 PRODUCTS & SERVICES
Insurance Products Offered –

For Businesses:
 Property Insurance: Covers commercial buildings, machinery,
equipment, and inventory against fire, theft, natural disasters, and other
specified perils. You can choose from various building sum insured options
and consider add-on covers for business interruption and breakdown of
machinery.

 Business Interruption Insurance: Provides financial compensation for loss

of income due to a disruptive event (fire, natural disaster) that temporarily
halts your business operations.

 Liability Insurance: Protects your business from financial liabilities arising

from lawsuits due to bodily injury or property damage caused to third parties
during your business operations. This can include:
o Product Liability Insurance: Covers claims arising from injuries or
property damage caused by your products.
o Professional Liability Insurance (Errors and Omissions
Insurance): Protects professionals (doctors, lawyers) from claims of
negligence resulting in financial loss for the client.

 Marine Insurance: Covers cargo and ships involved in import and export
activities against loss or damage during transportation.

 Cyber Insurance: Protects businesses from financial losses and legal

expenses arising from cyberattacks, data breaches, and other cyber threats.

 Group Health Insurance: Provides health insurance coverage for employees

and their dependents at a discounted rate compared to individual plans.

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 PRODUCTS & SERVICES

Additional Points:
 This list is not exhaustive. Depending on your specific needs and risk profile,
there might be more specialized insurance products available.
 Each category may have various sub-categories and add-on covers to
customize the policy as per individual or business requirements.
 As your broker, I would work closely with you to understand your risk profile,
budget, and specific needs. Based on this information, I can recommend the
most suitable insurance products and coverage options.

My Value as Your Broker:

 Save Time & Effort: I can help you compare quotes from different insurance
companies, saving you time and effort from researching individual policies.

 Expert Guidance: I can explain the intricacies of different policies, highlight

exclusions, and answer your questions to ensure you make informed
decisions.

 Negotiation Power: I can leverage my relationships with insurance

companies to potentially negotiate better premiums on your behalf.

 Claims Assistance: In case of a claim, I can guide you through the claims
process and ensure a smooth experience.

By utilizing my expertise and access to various insurance providers, I

can help you find the best insurance coverage for your specific needs at
a competitive price. Remember, I am here to represent your interests
and ensure you have the right protection in place.

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 PRODUCTS & SERVICES

Value-added Services -
we can offer a variety of valuable services as your general insurance broker such as
services like consulting, claims processing assistance, etc.

Consulting Services:

 Risk Assessment: We conduct a risk assessment to identify potential risks

you or your business face. This will help determine the type and extent of
insurance coverage you need.
 Policy Review: We review your existing insurance policies to ensure they
provide adequate coverage and are still competitive in terms of premiums.
 Developing a customized insurance plan: Based on client risk profile and
needs, we help our client to create a comprehensive insurance plan that
includes the right combination of policies and coverage options.

Claims Processing Assistance:

 Claim Guidance: In the unfortunate event of a claim, I can guide you through
the entire claims process, ensuring you understand the paperwork and
procedures involved.
 Claim Negotiation: I can assist you in negotiating with the insurance
company to ensure you receive a fair settlement for your claim.
 Dispute Resolution: If you face any disputes with the insurance company
regarding your claim, I can help you navigate the resolution process.

Additional Valuable Services:

 Market Updates: I can keep you informed about the latest changes in the
insurance industry, new policy offerings, and regulatory updates.
 Loss Prevention Tips: I can provide tips and resources to help you minimize
risks and prevent potential losses.
 Renewal Reminders: I can help you stay on top of your insurance policy
renewals and ensure you don't face any lapse in coverage.

Overall Benefits: By offering these value-added services, I go beyond simply

being a broker who finds you insurance policies. I aim to be a trusted advisor who
helps you manage your risk profile, make informed insurance decisions, and
navigate the complexities of the claims process. This can save you time, money, and
stress, especially during a challenging situation like a claim.

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 MARKETING STRATEGY
Marketing Approach: How you plan to reach your audience (digital
marketing, networking, etc.).

Digital Marketing Strategies:

 Develop a User-Friendly Website: Create a website that clearly explains
your services, target markets, and the benefits of using a broker.
o Include sections on different insurance products, risk assessment tools,
and client testimonials.
o Ensure your website is mobile-friendly and optimized for search
engines (SEO) to improve online visibility.
 Content Marketing: Create informative and engaging content (blog posts,
articles, infographics, videos) on insurance topics relevant to your target
audience.
o Address common concerns, explain complex products, and highlight
the advantages of using a broker.
o Share content on social media platforms and distribute it through email
marketing campaigns.
 Social Media Marketing: Establish a strong presence on social media
platforms like Facebook, LinkedIn, and Twitter.
o Share informative content, industry news, and engage with potential
clients through discussions and Q&A sessions.
o Utilize targeted social media advertising to reach a wider audience
based on demographics and interests.
 Search Engine Marketing (SEM): Consider pay-per-click (PPC) advertising
on search engines like Google to appear for relevant keywords related to
"general insurance broker" or specific insurance products.

Offline Marketing Strategies:

 Networking: Attend industry events, business conferences, and local
chamber of commerce meetings.
o Network with potential clients, build relationships with other
professionals (financial advisors, real estate agents), and explore
referral partnerships.
 Content Marketing (Offline): Partner with local businesses to distribute
brochures, flyers, or informative booklets on the benefits of using a broker.
o Consider sponsoring local events or offering educational workshops on
insurance topics.
 Public Relations (PR): Issue press releases announcing new services or
partnerships.
o Aim to get featured in local publications or online insurance blogs to
increase brand awareness.

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 MARKETING STRATEGY

Additional Considerations:

 Target Audience Segmentation: Tailor your marketing message to resonate

with different segments of your target audience (individuals, businesses,
specific industries).

 Building Trust & Credibility: Showcase your expertise through content,

client testimonials, and industry certifications.
o Highlight your commitment to providing unbiased advice and
personalized service.

 Data & Analytics: Track the performance of your marketing campaigns

(website traffic, social media engagement) and adjust strategies based on
data insights.

Conclusion:
By implementing a comprehensive marketing strategy that combines
digital and offline approaches, a general insurance broker in India can
effectively reach its target audience, build brand awareness, and attract
new clients. Remember, the key is to provide valuable information,
demonstrate expertise, and build trust with potential clients to establish
yourself as a reliable advisor in the general insurance landscape.

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 SALES STRATEGY
Sales Strategy for Acquiring and Retaining
Customers: General Insurance Broker in India
Building a successful sales strategy as a general insurance broker in
India involves a two-pronged approach: acquiring new clients and
retaining existing ones. Here's a breakdown of effective methods:

Acquiring New Clients:

 Lead Generation: Leverage your marketing efforts (website, social media,
content) to generate leads.
o Offer free consultations, downloadable resources, or webinars on
insurance topics to capture contact information.
o Consider partnering with other professionals (financial advisors, real
estate agents) for referrals.
 Needs Assessment: Conduct a thorough needs assessment with potential
clients to understand their risk profile, budget, and insurance requirements.
This personalized approach builds trust and allows you to recommend the
most suitable coverage.
 Competitive Analysis: Compare quotes from different insurance companies
and highlight the benefits of the chosen policy while addressing any potential
concerns about cost or coverage limitations.
o Emphasize the value you add as a broker, such as saving time,
providing expert guidance, and negotiating better premiums.
 Building Trust: Transparency and clear communication are key. Explain
insurance terms clearly, avoid jargon, and address any doubts or concerns
openly. Showcase your expertise and commitment to finding the best possible
coverage for your client's needs.

Retaining Existing Clients:

 Excellent Customer Service: Provide exceptional customer service by being
responsive, helpful, and proactive. This includes:
o Regularly reviewing client policies and recommending adjustments as
their needs evolve (growing family, new business venture).
o Addressing any questions or concerns promptly and efficiently.
o Keeping clients informed about policy renewals, premium changes, and
industry updates.

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 SALES STRATEGY
 Claims Assistance: During a claim situation, be there for your client. Guide
them through the claims process, assist with paperwork, and advocate for
their fair compensation.
o A smooth and hassle-free claims experience builds loyalty and trust.
 Value-Added Services: Go beyond basic broking services and offer
additional value:
o Conduct risk assessments for existing clients to identify areas for
improvement.
o Provide loss prevention tips and resources to minimize risks.
o Offer educational workshops or webinars on insurance topics relevant
to your client base.
 Client Appreciation: Show your clients you appreciate their business. Send
birthday greetings, personalized thank you notes, or offer small tokens of
appreciation.

Additional Strategies:
 Referral Programs: Incentivize existing clients to refer friends and family by
offering referral bonuses or discounts.
 Client Testimonials: Showcase positive client testimonials and case studies
on your website or marketing materials to build trust with potential clients.
 Build Long-term Relationships: Don't view clients as a one-time
transaction. Invest in building long-term relationships by providing exceptional
service, ongoing support, and demonstrating your commitment to their
financial well-being.

Technology Adoption:
Utilize technology to streamline your sales process and enhance client experience:

 Customer Relationship Management (CRM) software can help you

manage leads, track client interactions, and personalize communication.
 Online portals allow clients to access policy documents, manage renewals,
and submit claims electronically.

By implementing these strategies, general insurance brokers in India can acquire

new clients through targeted marketing and needs-based solutions while fostering
long-term relationships with existing clients through exceptional service, value-added
offerings, and a commitment to their financial security. Remember, building trust and
exceeding client expectations are key differentiators in a competitive market.

26
 OPERATIONS PLAN
Operational Workflow for a General Insurance
Broker in India
Daily Operations: The daily operations of a general insurance broker
involve a series of interconnected tasks focused on acquiring new
clients, servicing existing clients, and managing policies. Here's a
breakdown of the typical workflow:

Lead Generation & Qualification:

 Marketing Activities: The day might begin with reviewing the results of
marketing campaigns (website leads, social media inquiries) and qualifying
potential clients through initial contact.
 Lead Qualification: This involves understanding the client's needs, risk
profile, and budget to determine if they are a good fit for your services.

Client Needs Assessment & Consultation:

 Schedule Meetings: Once a qualified lead is identified, schedule an initial
consultation (in-person, phone call, video conference) to understand the
client's specific insurance needs.
 Needs Analysis: During the consultation, delve deeper into the client's
situation. This might involve discussing:
o Assets to be insured (home, car, business property)
o Potential risks and exposures
o Existing insurance coverage (if any)
o Budget and risk tolerance

Product Research & Recommendation:

 Researching Options: Based on the client's needs, research and compare
insurance products from various insurance companies. This involves
considering:
o Coverage options and exclusions
o Premiums and deductibles
o Insurer reputation and claim settlement ratio
 Policy Recommendation: Develop a personalized insurance plan tailored to
the client's specific needs and budget. This might involve recommending a
combination of policies from different insurers.

27
 OPERATIONS PLAN
Proposal & Negotiation:
 Proposal Preparation: Prepare a detailed proposal outlining the
recommended insurance plan, including policy details, coverage limits,
premiums, and justification for the chosen options.
 Negotiation: Negotiate with insurance companies on behalf of the client to
potentially secure better premiums or coverage terms.

Policy Procurement & Onboarding:

 Client Acceptance: Once the client accepts the proposal, assist with the
application process and ensure all necessary documentation is collected.
 Policy Issuance: Liaise with the chosen insurance company to ensure
smooth policy issuance and delivery to the client.

Client Service & Retention:

 Policy Review: Schedule a meeting with the client to review the new policy,
answer any questions, and ensure they understand the coverage details.
 Ongoing Communication: Maintain regular communication with clients,
keeping them informed about policy renewals, premium changes, and industry
updates.
 Claims Assistance: In case of a claim, be the client's advocate. Guide them
through the claims process, assist with paperwork, and ensure they receive
fair compensation from the insurance company.

Additional Tasks:
 Market Research: Stay updated on industry trends, new insurance products,
and regulatory changes.
 Compliance: Ensure adherence to all IRDAI (Insurance Regulatory and
Development Authority) regulations related to insurance broking activities.
 Networking: Continually network with potential clients, other professionals
(financial advisors), and insurance companies to build relationships and
generate new business opportunities.

Technology in Workflow:
 CRM Software: Utilize Customer Relationship Management (CRM) software
to manage leads, track client interactions, store policy documents, and
automate tasks.
 Online Portals: Provide clients with access to online portals where they can
view policy details, manage renewals, and submit claims electronically.

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 OPERATIONS PLAN

Suppliers and Partners: Information about any third-

party services or partnerships.
As a general insurance broker, we don't directly have suppliers in the traditional
sense. However, to function effectively, we would rely on partnerships with several
key third-party service providers and potentially other professionals:

Essential Partnerships:
 Insurance Companies: The core of my business revolves around partnering
with various insurance companies in India. I would establish relationships with
multiple insurers to offer clients a wide range of insurance products and
competitive quotes.
 Technology Providers: Utilizing Customer Relationship Management (CRM)
software is crucial for managing client data, interactions, and policy details.
Partnering with a reliable CRM provider ensures efficient operations and
streamlined communication.

Potential Partnerships:
 Financial Advisors: Collaboration with financial advisors can be mutually
beneficial. They can refer clients who need insurance solutions, and I can
assist their clients in finding suitable coverage while potentially expanding my
client base.
 Real Estate Agents: Partnering with real estate agents can be another
avenue for lead generation. Real estate agents often deal with clients who
need homeowner's insurance or other property-related coverage.

Additional Services:
 Legal and Compliance Experts: Staying updated on complex insurance
regulations and legalities is vital. Partnering with legal or compliance experts
can ensure adherence to IRDAI regulations and provide guidance on handling
complex situations.

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 OPERATIONS PLAN

Benefits of Partnerships:
 Access to a Wider Range of Products & Services: Partnering with various
insurance companies allows me to offer clients a diverse selection of
insurance products to meet their specific needs.
 Enhanced Expertise: Collaboration with other professionals like financial
advisors can provide access to their expertise and potentially open doors to
new client segments.
 Streamlined Operations: Technology partnerships can improve operational
efficiency by automating tasks and managing client data effectively.

Building Trustworthy Relationships:

The success of these partnerships hinges on building trust and open communication.
By demonstrating expertise, professionalism, and a commitment to client
satisfaction, I can foster strong relationships with these third parties, ultimately
benefiting my clients by offering them a comprehensive insurance broking
experience.

Important Note:

Conclusions Operations Plan:

Overall, the operational workflow of a general insurance broker is a
dynamic process that revolves around building relationships with clients,
understanding their needs, providing them with the best possible
coverage options, and offering ongoing support throughout their
insurance journey.

Conclusions: Suppliers & Partners:

It's important to maintain transparency with clients regarding any
partnerships or affiliations. This ensures clients understand who I work
with and how these partnerships benefit them in terms of securing the
best possible coverage options.

30
 MANAGEMENT & ORGANIZATION

A - Management Team: Profiles of key team members and

their roles.
As a large language model, I can't directly represent a specific company and its team
structure. However, to give you an idea of the typical team composition for a general
insurance brokerage in India, here are some key roles and their functionalities:

 Principal Broker/Managing Director:

o Leads the overall business strategy and operations of the brokerage.
o Oversees client relationships, marketing initiatives, and team
performance.
o Ensures adherence to IRDAI regulations and compliance standards.
o May hold extensive experience in the insurance industry and possess
strong leadership skills.
 Sales & Marketing Manager:
o Develops and implements marketing strategies to generate leads and
attract new clients.
o Manages the brokerage's online presence and social media marketing
efforts.
o Oversees the sales team and sets performance targets.
o Possesses excellent communication and interpersonal skills, along with
an understanding of the insurance industry.
 Insurance Brokers/Relationship Managers:
o Interact directly with clients to understand their insurance needs and
risk profile.
o Research and compare insurance products from various companies.
o Develop customized insurance plans and proposals for clients.
o Negotiate premiums and terms with insurance companies.
o Possess strong product knowledge, excellent communication skills,
and the ability to build trust with clients.
 Customer Service Representative:
o Provides ongoing support to existing clients.
o Answers client inquiries regarding policies, renewals, and claims.
o Assists clients with policy changes and updates.
o Maintains accurate client records and ensures timely communication.
o Possesses excellent communication and interpersonal skills, with a
focus on customer satisfaction.

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 MANAGEMENT & ORGANIZATION

 Operations Specialist:
o Handles the administrative aspects of policy issuance, renewals, and
endorsements.
o Liaises with insurance companies to ensure smooth policy processing.
o Maintains accurate client data and policy records.
o Ensures adherence to internal processes and operational efficiency.
o Possesses strong organizational skills and attention to detail.

Additional Team Members (depending on the size of the brokerage):

 Accountant: Manages the financial aspects of the business, including

bookkeeping, taxes, and financial reporting.
 IT Specialist: Oversees the brokerage's technology infrastructure, including
CRM software and data security.
 Legal Counsel: Provides legal advice and ensures compliance with
insurance regulations.

Teamwork and Collaboration:

The success of a general insurance brokerage relies on effective teamwork and
collaboration between different team members. Open communication, clearly defined
roles, and ongoing training are crucial for ensuring a smooth operational workflow
and exceptional client service.

B - Organizational Structure: Diagram or description of the

business structure.

General Insurance Brokerage - Organizational Structure

Here's a text description of a typical organizational structure for a general insurance
brokerage in India:

Flat Hierarchy (Small to Medium Brokerages):

In smaller brokerage firms, a flatter hierarchy is common. The Principal
Broker/Managing Director leads the team and oversees all operations. They might
directly manage a team of Insurance Brokers/Relationship Managers who handle
client interactions, policy recommendations, and sales. A single staff member might
handle Customer Service inquiries and basic administrative tasks like renewals.

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 MANAGEMENT & ORGANIZATION

Departmental Structure (Medium to Large Brokerages):

As the brokerage grows, a more departmentalized structure emerges:

 Management: The Principal Broker/Managing Director leads the overall

business strategy. They might be supported by a Deputy Director or specific
department heads.
 Sales & Marketing: This department focuses on lead generation, brand
awareness, and client acquisition. It's headed by a Sales & Marketing
Manager who oversees marketing campaigns, social media presence, and
the performance of the sales team.
 Broking & Client Services: This department is responsible for interacting
with clients, understanding their needs, recommending policies, and
negotiating with insurance companies. It's led by a Broking Manager who
supervises a team of Insurance Brokers/Relationship Managers.
 Customer Service: A dedicated Customer Service department handles
ongoing client communication, policy inquiries, renewals, and claims
assistance. It's managed by a Customer Service Manager who oversees a
team of representatives.
 Operations: This department ensures smooth policy processing, maintains
accurate client records, and manages data entry. It's led by an Operations
Manager who supervises Operations Specialists.
 Finance & Administration: This department handles financial aspects like
bookkeeping, taxes, and payroll. It might be managed by an Accountant or a
dedicated finance team.
 IT: A dedicated IT specialist or department might be responsible for the
company's technology infrastructure, including CRM software and data
security.

Additional Considerations:
 The specific structure can vary depending on the size and specialization of
the brokerage.
 Some brokerages might have dedicated legal counsel or compliance officers.
 Larger firms might have separate departments for marketing, web
development, and content creation within the Sales & Marketing department.

Conclusions:
Overall, the organizational structure should be designed to ensure efficient
operations, clear communication channels, and a client-centric approach.

33
 FINANCIAL PLAN

A - Capital Requirements: How much funding you need

and how it will be used.

In India, the minimum capital requirement to start a direct general insurance broking
business is ₹75 Lakhs (approximately ₹7.5 million or $93,750 USD as of May 17,
2024). This initial funding serves various purposes to get your brokerage off the
ground:

 Registration & Licensing: A portion of the funds will be used to pay for
registration fees and obtain the necessary licenses from the Insurance
Regulatory and Development Authority of India (IRDAI).
 Office Setup: Setting up a physical office space or a virtual office
infrastructure might require initial investment for furniture, equipment, and
technology.
 Marketing & Branding: Building brand awareness and attracting clients
might involve investments in website development, marketing campaigns
(online and offline), and potentially content creation.
 Technology & Software: Investing in Customer Relationship Management
(CRM) software is crucial to manage client data, track interactions, and
automate tasks. Additional software for policy processing or communication
might be needed.
 Operational Costs: Initial funding needs to cover operational expenses like
salaries for your team (brokers, customer service representatives, etc.),
internet connectivity, office supplies, and other ongoing business costs.

Additional Funding Considerations:

 Office Location: The cost of setting up an office can vary depending on the
city and location. A virtual office setup might be a cost-effective alternative
initially.
 Team Size: The number of employees you need initially depends on your
business plan and target client base. You might start with a lean team and
scale up as your client base grows.
 Marketing Strategy: The cost of marketing campaigns can vary depending
on the chosen channels (online advertising, social media marketing, content
creation) and their targeted reach.

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 FINANCIAL PLAN
Alternative Funding Options:
While ₹75 Lakhs is the minimum requirement, having additional capital provides a
buffer for unforeseen expenses and allows for faster growth. Here are some
possibilities:

 Personal Investment: The founders or directors of the brokerage might

contribute additional capital beyond the minimum requirement.
 Angel Investors: Seeking investment from angel investors interested in the
insurance broking sector can provide additional funding.
 Bank Loans: Banks might offer loans for starting businesses, but securing a
loan might require a strong business plan and potential collateral.

Remember:
 Consulting with a financial advisor can help you create a detailed budget and
explore funding options tailored to your specific business plan.
 It's crucial to manage your initial funding efficiently to ensure the long-term
sustainability of your general insurance broking business.

B - Revenue Projections: Forecast of the revenue for the

next 3-5 years.
As a large language model, I cannot access real-time market data or predict the
future. However, I can provide a general framework for forecasting revenue for a
general insurance broking business in India over the next 3-5 years. Here's a
breakdown of the factors to consider and a sample projection with assumptions:

Factors Influencing Revenue:

 Client Acquisition: The number of clients you acquire will directly impact
your revenue. This depends on your marketing efforts, target audience, and
brand reputation.
 Average Revenue per Client (ARPC): This depends on the type of
insurance products you sell, the complexity of the coverage, and the
premiums associated with those policies.
 Renewal Rates: Retaining existing clients and encouraging policy renewals is
crucial for consistent revenue generation.
 Growth Rate: Project a realistic growth rate for client acquisition and ARPC
considering market competition and your marketing strategy effectiveness.

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 FINANCIAL PLAN

Year 1:
 Clients Acquired:
 Average Revenue / Premium per Client (ARPC):
 Renewal Rate: Assumed to be low in the first year as you build a
client base

Year 2:
 Clients Acquired (New):
 Existing Clients Renewed: (Year 1 Clients * Renewal Rate) =
 Total Clients: (Year 1) + (Year @) (New) + (Renewed) =
 ARPC: Assumed to increase slightly (10%) due to potentially
upselling existing clients (₹0)
 Renewal Rate: Increase slightly as you establish client
relationships (40%)

Year 3 & Beyond:

 Continue to project client acquisition with a growth rate (e.g., 15%
new clients per year).
 Gradually increase ARPC as you potentially offer more complex
insurance products.
 Maintain or improve client renewal rates through excellent service
and value-added offerings.

36
 FINANCIAL PLAN

Here are some additional points to consider when making

your revenue projections:
 Factor in operational costs, such as salaries, marketing expenses,
and technology subscriptions, to estimate your net profit.
 Regularly review and update your projections as your business
grows and market conditions change.
 Conduct competitor analysis to understand their pricing strategies
and target markets.

By considering these factors and tailoring them to your specific business

goals, you can create a more realistic revenue projection for your
general insurance broking business in India.

C - Profit and Loss Statement: Expected income,

expenses, and profits.
Certainly, building on the revenue projections from the previous
step, we can craft a sample Profit and Loss (P&L) Statement
for a general insurance broker in India over the next 3 years.
Here's a breakdown of the income, expenses, and projected
profit:

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 FINANCIAL PLAN

Sample Profit and Loss Statement (₹) :

PRODUCTS: FIRE Insurance, MARINE Insurance, GMC, GPA,

CORPORATE
CAR, EAR, LIABILITY Insurance, D&O,
Business:
etc. etc..

CLIENTS Total Operating Profit &

Year Premium Commission
Count Revenue Expenses Loss

1st 10 75,000 - 9,25,000

1,50,000 15,00,000 10,00,000

1st Year commission @ 5%

2nd 60 13,50,000 - 6,50,000

3,00,000 1,80,00,000 20,00,000

2nd Year commission @

7.50%

3rd 150 93,75,000

5,00,000 7,50,00,000 30,00,000 63,75,000

3rd Year commission @

12.50%

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 FINANCIAL PLAN

Sample Profit and Loss Statement (₹) :

RETAIL PRODUCTS: Health Insurance, Motor Insurance, Travel Insurance,

Business Home Insurance, Accidental Insurance

CLIENTS Total Operating Profit &

Year Premium Commission
Count Revenue Expenses Loss

1st 100 -5,50,000

10,000 10,00,000 1,50,000 7,00,000

1st Year commission @ 15%

2nd 300
12,000 36,00,000 7,20,000 7,00,000 20,000

2nd Year commission @ 20%

3rd 600
15,000 90,00,000 22,50,000 10,00,000 12,50,000

3rd Year commission @ 25%

39
 FINANCIAL PLAN

Assumptions:
 The initial capital investment of ₹75 Lakhs is not included here; it's a one-time
expense.
 Client acquisition and revenue figures are based on the sample projections in
the previous section.
 Operating expenses are estimates and might include:
o Salaries for brokers, customer service representatives, and other staff.
o Marketing and advertising costs.
o Office rent and utilities.
o Technology and software subscriptions.
o Insurance Regulatory and Development Authority (IRDAI) fees and
other regulatory charges.
 The operating expense increase considers inflation and potential growth in
your team size.
 This is a simplified P&L statement, and other income or expenses might exist
depending on your specific business (e.g., interest on investments).

Important Notes:
 These are just sample projections, and the actual figures will vary significantly
depending on your business operations and market performance.
 The P&L statement shows a net loss in the initial years, which is common for
new businesses that are still acquiring clients and building a brand reputation.
 Closely monitor your actual income and expenses to compare them to your
projections and adjust your strategies as needed.

Break-even Analysis:
It's also important to consider your break-even point, which is the point where your
revenue equals your operating expenses, resulting in zero profit or loss. By
analysing your revenue projections and estimated operating costs, you can
determine the number of clients you need to acquire and the average revenue per
client to achieve profitability.

By crafting a P&L statement and conducting break-even analysis, you can gain
valuable insights into the financial health of your projected general insurance broking
business. Remember to tailor these projections to your specific circumstances and
update them regularly as your business evolves.

40
 FINANCIAL PLAN

D - Break-even Analysis: When you expect to become

profitable.

Based on the sample Profit and Loss Statement projections we

discussed earlier, profitability is not expected within the first 3 years.
Here's a breakdown of the factors to consider for a more precise break-
even analysis for your general insurance broking business in India:

Key Factors Influencing Break-even Point:

 Client Acquisition Cost: How much does it cost to acquire a new client
(marketing, advertising, lead generation)?
 Average Revenue per Client (ARPC): What is the average premium amount
you earn per client per year (considering different insurance products)?
 Renewal Rate: How many existing clients renew their policies each year?
 Operating Expenses: What are your ongoing operational costs (salaries,
rent, marketing, technology)?

Calculating Break-even:
There's no one-size-fits-all formula, but a simplified approach to estimate the break-
even number of clients is:

 Break-even Clients = Total Operating Expenses / (ARPC * Renewal Rate)

Interpretation:
According to this simplified calculation, to achieve profitability in year 2, you would
need to acquire and retain at least 150 clients. This is just an estimate, and the
actual number could be higher or lower depending on the factors mentioned earlier.

41
 FINANCIAL PLAN

Factors Affecting Profitability Timeline:

 Client Acquisition Cost: Reducing client acquisition costs can significantly
improve your profitability timeline.
 Increasing ARPC: Selling insurance products with higher premiums can
increase your ARPC and accelerate profitability.
 Improving Renewal Rates: Retaining existing clients and encouraging
renewals is crucial for sustainable profits.
 Controlling Operating Expenses: Managing your operational costs
efficiently helps you reach profitability faster.

Recommendations:
 Conduct a detailed cost analysis to determine your exact client acquisition
cost and operational expenses.
 Develop strategies to reduce client acquisition costs (e.g., targeted marketing,
referral programs).
 Focus on selling a mix of insurance products to optimize your ARPC.
 Implement strategies to improve client retention (excellent service, value-
added offerings).
 Regularly monitor your progress and adjust your strategies based on real-time
data.

Remember:
Break-even analysis is an estimate, and achieving profitability might take longer than
initially projected. Building a successful general insurance broking business requires
a long-term commitment to client acquisition, service excellence, and cost
management.

42
 CONCLUSION

The Indian insurance broking industry presents a

dynamic and promising landscape for a well-planned
general insurance brokerage. With a growing demand
for risk management solutions and a rising middle class,
the potential for client acquisition and market share is
substantial.
By leveraging a team of experienced professionals, a
data-driven marketing strategy, and a commitment to
exceptional client service, general insurance brokerage
can establish itself as a trusted advisor. Focusing on a
diverse product portfolio, optimizing client retention
rates, and controlling operational costs will pave the way
for sustainable profitability.
This comprehensive business plan serves as a roadmap
to navigate the initial challenges and propel General
Insurance Broker business towards future success. With
dedication, strategic execution, and a focus on client-
centricity, general insurance brokerage has the potential
to become a leading player in the ever-evolving Indian
insurance market.

43
 INSURANCE BROKER REGULATIONS

This document summarizes the answers to various questions you might encounter
on the Insurance Broker Licensing Exam. Refer to the Insurance Regulatory and
Development Authority (IRDAI) website (IRDAI) for the latest regulations and details.

Licensing Requirements

1. Minimum Capital Required:

o Direct Broker: ₹75 Lakhs
o Reinsurance Broker: ₹400 Lakhs
o Composite Broker: ₹500 Lakhs
2. Training:
o Direct Broker/Reinsurance Broker: Principle Officer and individuals soliciting business
require a minimum of 100 hours of training from an IRDAI-recognized institution.
3. Application Fees (Non-Refundable)

 Direct Broker: ₹20,000/-

 Reinsurance Broker: ₹25,000/-
 Composite Broker: ₹40,000/-

4. License Validity

 Insurance Broker License: 36 Months

5. Broker Categories (as per Regulation 3)

 There are five categories for applying for a Broker License.

6. Broker Remuneration

 Brokers are compensated by incentive & commission, regulated by IRDAI.

7. Books of Accounts

 Brokers are required to maintain all of the following:

o Balance Sheet
o Profit and Loss Account
o Statement of Cash Flow

8. License Renewal

 The validity period for an Insurance Broker license is not 5 years (it's 3 years).
 Late fee for renewal up to 6 months after expiry: ₹1000

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 INSURANCE BROKER REGULATIONS

9. Broker License Fees

a. Reinsurance Broker:

 A license fee of ₹25,000/- is payable upon initial licensing.

 Renewal fees are 0.5% of the remuneration earned in the preceding financial year,
subject to a minimum of ₹125,000/- and a maximum of ₹5,00,000/-.
 The prescribed license fee needs to be paid within 15 days of receiving intimation for
application acceptance.

b. Direct Broker:

 A license fee of ₹20,000/- is payable upon application.

 Renewal fees are 0.5% of the remuneration received in the preceding financial year,
subject to a minimum of ₹75,000/- and a maximum of ₹3,00,000/-.
 The prescribed license fee needs to be paid within 15 days of receiving intimation for
application acceptance.

10. Definition of Insurance Broker

 An Insurance Broker arranges suitable insurance contracts with insurers and

reinsurers for clients. They represent the client, not the insurance company.

11. Cancellation of Broker License

A Direct Broker's license can be cancelled for various reasons, including:

 Failing to maintain proper books of accounts

 Not resolving policyholder complaints
 Violating IRDAI regulations

12. Incorrect Statement (IRDA Insurance Brokers Regulation 2002)

 The authority is the Insurance Regulatory and Development Authority (IRDAI), not
the Ministry of Finance.

13. Professional Indemnity Cover

The limits of professional indemnity cover vary by broker type. Refer to IRDAI
for details.

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 INSURANCE BROKER REGULATIONS

14. Post-Closure Service Requirement

The information on required service months after closing a business firm is

not specified here. Refer to IRDAI for details.

15. Types of Insurance Brokers

 Direct Broker: Arranges insurance for clients with insurance companies.

 Reinsurance Broker: Arranges reinsurance for clients with reinsurance companies.
 Composite Broker: Can arrange both direct insurance and reinsurance.
 Micro-Insurance Agent: Sells micro-insurance products, a specific category of
insurance.

46
 GLOSSARY

 CAGR: Compound Annual Growth Rate

 IRDAI: Insurance Regulatory and Development Authority

 IPO: Initial Public Offering

 FDI: Foreign Direct Investment

 LIC: Life Insurance Corporation of India

 GIC: General Insurance Corporation of India

 NBFC: Non-Banking Financial Company

 NGO: Non-Governmental Organization

 RSBY: Rastriya Swasthya Bima Yojana

 PFRDA: Pension Fund Regulatory and Development Authority

 GDP: Gross Domestic Product

 ESIC: Employees State Insurance Corporation

 FY: Indian Financial Year (April to March)

 So, FY12 implies April 2011 to March 2012

 GOI: Government of India

 Rs: Indian Rupee

 US$: US Dollar

 Where applicable, numbers have been rounded off to the nearest whole number

47
 DISCLAIMER

 BuyVima (Venture of VimaBharat General Insurance Broking Pvt. Ltd) engaged

Aranca (Mumbai) Pvt. Ltd. to prepare/update this presentation.

 All rights reserved. All copyright in this presentation and related works is
solely and exclusively owned by VGIBPL, delivered during the course of
engagement under the Professional Service Agreement signed by the
Parties. The same may not be reproduced, wholly or in part in any material
form (including photocopying or storing it in any medium by electronic means
and whether or not transiently or incidentally to some other use of this
presentation), modified or in any manner communicated to any third party
except with the written approval of VGIBPL.

 This presentation is for information purposes only. While due care has been
taken during the compilation of this presentation to ensure that the information
is accurate to the best of Aranca (Mumbai) Pvt. Ltd and VGIBPL’s knowledge
and belief, the content is not to be construed in any manner whatsoever as a
substitute for professional advice.

 Aranca (Mumbai) Pvt. Ltd and VGIBPL neither recommend nor endorse any
specific products or services that may have been mentioned in this
presentation and nor do they assume any liability, damages or responsibility
for the outcome of decisions taken as a result of any reliance placed on this
presentation.

 Neither Aranca (Mumbai) Pvt. Ltd nor VGIBPL shall be liable for any special,
direct, indirect or consequential damages that may arise due to any act or
omission on the part of the user due to any reliance placed or guidance taken
from any portion of this presentation.

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