A reinsurance broker is an insurance intermediary with an Insurance Broker License that provides reinsurance companies to its clients. Its clients are not insurance policy seekers, but insurance companies. Thus, you can define reinsurance services are facilities to provide risk management services associated with insurance policies.
In this article, we will discuss several functions of a Re-insurance broker.
Knowing the client
Any intermediary has to understand the financial preferences and principals of its client. In case of a reinsurance broker, his first task is to familiarize himself with the risk retention and business philosophy of its client insurance companies.
Maintaining the record of its client’s business
Information is key better serve the clients. Thus, a reinsurance broker maintains a records of the insurance company it services. The records contain business and other details relevant to the insurance domain.
Advising the insurance companies
A reinsurance broker has ample of knowledge about the reinsurance market. Leveraging that knowledge, it provides the insurance companies – clients – with advise about which reinsurance policies to buy.
Keeping an Eye on the market
A reinsurance broker holding the Insurance broker license has to be vigilant about the state of insurance market. Thus, it keeps tabs on the insurance markets, including the insurance companies that have recently gone bankrupt.
Risk management Services
Providing important risk management services, a reinsurance broker assists the clients consolidate their financial standing within the insurance domain.
A reinsurance broker provides recommendations to an insurer about the services that a particular group of reinsurers provide. Read More: Insurance Marketing Firm
A reinsurance broker negotiates on behalf of insurers the reinsurance companies. The goal negotiation is to ensure that the client gets the best reinsurance services at reasonable cost.
Assistance during commutation
In case of a criminal investigation, a reinsurer provides information about the reinsurance policies and reinsurers it has engaged to aid with commutation of its clients.
Following the instruction of insurance companies
A broker has to serve its clients that are the insurance companies. It has to act according to their instructions and provide them regular progress reports.
Collecting premiums and claims as per the agreed timeline
A reinsurance broker gets into contract with an insurer bearing an understanding to provide services related to collection of premium. Therefore, it has to provide those services as per the deadline specified in the agreement.
Helping with claim settlement
When it comes to settling the insurance claims, insurance companies often need assistance to mitigate the risks. Here, the reinsurance broker assist with claim settlement services by way of negotiation.
Carefully selecting reinsurance broker companies
A broker has to serve the insurance company with integrity. Thus, it has to conduct a thorough research before finding a suitable reinsurance company or an international insurance company. The research procedure includes assessing the security ratings of each prospect reinsurance company and assessing the responsibilities of the reinsurers at the time of negotiations. Read More: Corporate Agent License
Enhancing the insurance market
One of the major responsibilities of a reinsurance broker is to create a market that facilitates new, stressed, emerging and existing businesses for and from reinsurers and insurers. Simply put, it’s to create a conducive environment that can help insurance industry grow in India.
No business can always have a rising trajectory. Sometimes, there are small losses that insurance companies have to bear. In such instances, Reinsurance brokers provide Preliminary Loss Advise (PLA) to get those insurance companies back on track.
As you can see, the services that a broker provides is quite large. However, it’s a lucrative business venture and if you’re willing to go further with Insurance Broker license, you can easily become one. Related Content: Trademark Renewal
What are the functions of a reinsurance broker in India? Find out about the functions of a unique holder of insurance broker license. For more info, contact Registrationwala.