Day by day, prioritising your health is becoming more important than ever. Given the 14% healthcare inflation in 2024, it is also important to note that you’re purchasing your policy from the right source. After all, it is an insurance plan that offers coverage along with financial security for your loved ones. Another statistical highlight here to know about is that as of March 31, 2023, the public sector had 13.47 lakh agents. At the same time, 12.80 lakh insurance agents were recorded in the private sector.
Understanding how the distinction between licensed and unlicensed agents, regardless of their sector, can significantly impact your insurance experience, coverage, and premium. So, without further due, continue reading to explore the difference between licensed and unlicensed insurance agents.
Why Choose an Insurance Agent with a License?
A licensed agent selling insurance plans is considerably a professional who has undergone rigorous training and passed the necessary examinations. The examination and received certification are set by the IRDAI (Insurance Regulatory and Development Authority of India). In fact, on March 31st, 2023, the IRDAI claimed 26.28 lakh insurance agents to be licensed.
By being licensed, these agents offer the following advantages:
- Expert Knowledge: A licensed insurance agent has comprehensive knowledge about different insurance policies. This expertise ensures that you receive accurate information tailored to your specific needs.
- Ethical Standards: Licensed agents are bound by regulatory guidelines and ethical standards, ensuring that your interests are prioritised.
- Legal Protection: In case of disputes, a licensed agent is accountable to regulatory bodies, providing you with an additional layer of security.
- Customised Advice: With access to a broad range of insurance products, insurance agents with licenses can offer personalised solutions.
What is an Unlicensed Insurance Agent?
An insurance agent operating without the required certification from regulatory authorities is labelled as an unlicensed agent. These individuals may lack formal training and are not legally authorised to sell insurance policies.
Moreover, engaging with them also brings a set of risks to the table, which may include the following:
- Limited Knowledge: Without formal training, unlicensed agents may not fully understand the intricacies of various insurance products, potentially leading to misinformation.
- Lack of Accountability: Unlicensed agents are not bound by the same regulatory standards, leaving you vulnerable in case of any discrepancies or disputes.
- No Legal Recourse: If an unlicensed agent misguides you, seeking legal redress can be challenging, as they operate outside the purview of regulatory bodies.
- Potential Scams: Engaging with unlicensed agents increases the risk of falling victim to fraud, as these agents may not have the necessary oversight.
Why Choose a Licensed Insurance Agent?
According to a survey, insurance policyholders in India lost approximately $6.25 billion due to fraud-related experiences. Now, this is a big reason to build your credibility and know the difference between a licensed and unlicensed agent.
| Feature | Licensed Insurance Agent | Unlicensed Insurance Agent |
| Regulatory Compliance | Yes | No |
| Formal Training | Yes | No |
| Legal Accountability | Yes | No |
| Consumer Protection | High | Low |
| Risk of Fraud | Low | High |
Selecting an insurance agent carefully ensures you’re dealing with a professional who is qualified and regulated. Even when you’re looking for a licensed health insurance agent, their authentication can offer you the following features:
Trust and Credibility
Licensed agents have passed stringent exams and met educational requirements, which instills confidence in their ability to provide reliable advice.
Consumer Protection
By law, licensed agents must adhere to ethical standards, offering you a layer of protection against malpractice.
Comprehensive Knowledge
These agents are well-versed in the latest insurance products and industry trends, ensuring you receive up-to-date information.
Legal Recourse
If a dispute arises, you have the legal backing to seek recourse against a licensed agent, something that is not available with unlicensed agents.
How to Verify an Insurance Agent’s Credentials?
In India, insurance agents must obtain a licence from the Insurance Regulatory and Development Authority of India (IRDAI). This body ensures that agents comply with industry standards, providing consumers with trustworthy services. Therefore, it is of utmost importance to get verified by the IRDAI because it is what will make you a credible insurance agent.
To ensure you’re dealing with a licensed insurance agent, you can do the following things:
- Check with IRDAI: The IRDAI website offers a database of registered agents.
- Ask for Documentation: Legitimate agents will readily provide their licence details.
- Look for Reviews: Online reviews can offer insights into the agent’s track record and professionalism.
Conclusion
When it comes to securing your health and financial well-being, choosing the right insurance agent is crucial. A licensed agent offers unparalleled expertise, ethical assurance, and legal protection, making them a reliable choice for the same. Moreover, nowadays, top insurance companies, like Niva Bupa, are operating frequently through agents. This means you need not worry much about where your insurance is coming from.
However, it is still essential to keep in mind what differentiates a licensed and unlicensed insurance agent. At Niva Bupa, licensed agents are ensured to have complete knowledge and are IRDAI-certified. Opting for a licensed agent ensures that your insurance journey is smooth, secure, and tailored to your unique needs.
Trust the expertise and professionalism of Niva Bupa licensed agents to safeguard your future, providing you and your family with the best possible protection.
