1. CORPORATE AGENTS
In order to spread awareness about insurance and to increase the coverage of a large section
of population who have remained outside the radius of insurance coverage all these years,
the IRDA introduced a variety of intermediaries as “distribution” is key to insurance penetration.
The Corporate Agent is a concept introduced with a view to taking advantage of the presence
of a large number of firms, corporations, banks, NGOs, cooperative societies and panchayats
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Distribution Channels in Life Insurance
who are in contact with people in normal discharge of their activities and utilize their presence
and services for canvassing the sale of insurance contracts.
Corporate Agents (CAs) are corporate entities (NBFCs) that source policies for the Insurance
Company with whom they have a tie-up. They are authorized to source policies for one
insurance company only. The difference between CA and Bancassurance arrangement is
that the former trains its own employees to sell the policies while in case of Bancassurance
arrangement, the employees of the insurance company (FSCs) source the business.
Criteria to become a corporate agent: As the insurance contracts are highly technical in
nature, the regulations issued by the IRDA stipulated that canvassing should be done only by
“specified persons” engaged by the Corporate Agents and such specified persons should
have the qualification prescribed by the authority. In case of corporate executives also, the
IRDA has prescribed certain qualifications to obtain a license.
In other words, in order to become a corporate agent, the corporate agency should have the
people who posses qualification as prescribed by the IRDA and also the persons working for
the particular agency should have a legal license which would enable them to act as solicitor
or the procurer on behalf of the agency. One more condition is that license should be issued
by a competent authority.
The decision to engage any person as a Corporate Agent will be taken only in the corporate
office of the Insurance company and proceedings appointing the „Person‟ as Corporate Agent
will be issued by an officer who will specially be designated by the Chief Executive Officer
to issue such orders. The officer so designated shall maintain a list of corporate agents
appointed by the company and will be responsible for ensuring that the corporate agents
comply with the regulations and the circulars and instructions issued by the authority from
time to time. The officer will also communicate to the IRDA the updated list of corporate
agents engaged by the insurer on half yearly basis. In this communication, the officer should
specially highlight the cancellation of licenses, if any and give brief reasons leading to the
cancellation.
Potential corporate agents can be:-
lInstitutions having high customer base in rural regions – Micro Insurance – High
customer base to be exploited in this segment, eg. ITC, etc.
lNGOs
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Distribution Channels in Life Insurance
lRelatively new and untapped NBFCs like Religare, etc.
lRetailers

2. Brokers
INSURANCE BROKERS ASSOCIATION OF INDIA (IBAI) is the IRDA-recognized apex body of all
licensed insurance brokers in India.
An insurance broker can save you, the insurance buyer, time, money and worry. Insurance is a
wasted purchase if it doesn't provide cover when disaster strikes. Many people unwittingly put their
livelihoods at stake, under-insure or overinsure, because they did not seek the right advice.
Whether you are arranging car, house, life or business insurance, brokers represent you, the buyer.
They shop around, provide advice, arrange the insurance and help with claims. It's a broker's job to
provide you with the most comprehensive and appropriate protection to suit your needs.
Why use a broker?
Insurance broker represents the insurance buyer, and not the insurance company (insurance seller),
though the remuneration of insurance broker is paid and borne by the insurance companies. There is
no additional cost to the insurance buyer for placing business through insurance broker.
Insurance brokers have been introduced into the indian market by insurance regulatory and
development authority (i.r.d.a.) as professionals, who will truly represent and service the interests of
insurance buyers.
Insurance brokers have qualified and experienced insurance experts and can buy insurance for their
clients at the most competitive premium rate and terms.
Insurance brokers provide a package of services to the insurance buyer, including post-insurance
services as well as assisting in submission of claim documents to insurance company. Please see
annexure for functions of insurnce brokers.
Insurance brokers have to obtain licence from the i.r.d.a. before they carry on insurance broking in
india and the operations of insurance brokers are monitored and controlled by i.r.d.a. a copy of code
of conduct prescribed by i.r.d.a. for insurance brokers is enclosed.
Insurance brokers are different from insurance agents. Insurance agents represent a given
insurance company, and not the insurance buyer. Thus, insurance agents sell the insurance policies
of a given insurance company, taking care of the interests of the insurance company (insurance
seller), and not of the insurance buyers.
Insurance brokers are professionals and represent the insurance buyers only, and not the insurance
company. Insurance broker can place the insurance of his client with any insurance company, in the
best interest of the insurance buyer. Thus, the insurance broker is a single window solution for all
insurance problems of the insurance buyer with all insurance companies.