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Union of India - Section

Section 19 in Insurance Regulatory and Development Authority of India (Insurance Brokers) Regulations, 2018

19. Capital Requirement.

(1)Any applicant seeking to become an insurance broker under these regulations shall have a minimum paid up capital/contribution as mentioned below:
Category Minimum Capital/ Contribution (Rupees)
Direct broker Seventy Five Lakh
Reinsurance broker Four crore
Composite broker Five crore
(2)the capital in the case of a company limited by shares and a cooperative society shall be in the form of equity shares;
(3)for the contribution of partners in the case of LLP shall only be in cash;
(4)the applicant shall exclusively carry on the business of an insurance broker as required under these regulations.
(5)the aggregate holdings of equity shares or contribution by foreign investors, including portfolio investors, shall be as prescribed by the Central Government from time to time;
(6)the shares of an insurance broker held as capital or contributions in case of a LLP or equivalent shall not be pledged in any form or manner to secure credit or any other facility and shall at all times be unencumbered.
(7)further, the investment in the applicant by the promoters/ shareholders/ partners shall be from their own funds and not from any other sources.Explanation. - For the purpose of these regulations own funds do not include funds arranged by way of borrowings or loans.