How to Become a Motor/Car Insurance Agent in India in 2024?
Becoming a motor insurance agent is a rewarding career path that involves several important steps. It includes a high school diploma or equivalent, completing the required pre-licensing courses and passing your state’s licensing exams. You can easily become a motor insurance agent with Digit, who offers robust support and tools to ensure your success.
Keep reading to discover more about this career and how Digit can help you achieve your goals.
What is Motor Insurance?
A motor insurance policy can be used to cover a car, a two-wheeler, or a commercial vehicle like an auto or a truck and is compulsory for all vehicles in India. It is also important for people to have it so that they are covered for losses and damages such as in the case of accidents and natural calamities.
There are primarily three types of motor insurance plans – Third Party Motor Insurance Policy, Own Damage Motor Insurance Policy and Comprehensive (or Standard) Motor Insurance Policy.
A Third-Party Motor Insurance is mandatory by the Motor Vehicles Act in India, without which people are liable for a heavy fine. It also protects one's pocket from any losses that could arise if their car were to damage any third-party vehicle, person or property.
The second is the Own Damage Insurance Policy, which is a customized motor insurance policy that is designed to protect oneself and their own vehicle from damages and losses.
Finally, Comprehensive Motor Insurance offers complete protection against both third-party damages and losses, and own damages. This includes protection from unforeseen losses such as accidents, natural calamity, fire or theft.
Who is a Motor Insurance Agent?
A motor insurance agent is someone who works with an insurance company to sell specific motor insurance products. If you were to be a Motor Agent or POSP, you would help customers choose the right motor insurance policy as per their requirements from all motor vehicle-related insurance plans.
With Digit, you can sell Car, Bike (or 2-Wheeler) and Commercial Vehicle policies.
*Disclaimer - There is no specific category for Agents. If you register for becoming a general Insurance agent, you can sell all general insurance products.
Interesting Facts about Motor Insurance Industry in India
The motor insurance market in India is expected to reach INR US$11.15bn by 2024.
The Indian car insurance sector is predicted to grow at a CAGR of 2.15% from 2024 to 2028.
The average spending per capita on the Motor Vehicle Insurance market is estimated to be INR US$7.74 in 2024.
Why Become a Motor Insurance Agent with Digit?
Learn more about why should you become a motor insurance agent, and why should you choose Digit?
As our POSP partner, you will work directly with us. No other middlemen involved. Digit is the fastest growing insurance company India today. We are currently the youngest company to be awarded Asia's General Insurance Company of the Year 2019.
We believe in making insurance simpler, which is why all our documents are so simple that even 15-year olds can understand them.
With technology as our main pillar, we offer you a dedicated support team, and an advanced web & mobile app that allows you to sell 24x7!
We believe in keeping our customers satisfied and have a Facebook rating of 4.8/5, highest for any insurance company.
In this short time, we have already reached more than 2% of the market share (in the previous quarter) in the motor insurance category.
We have a high claims settlement ratio for private cars and have settled 96% of all claims we have received for private cars.
Our processes are completely online, from issuing a policy to registering a claim. You don’t have to fill any paperwork. All you need is a smartphone/computer and an internet connection. So, you can now work from home or even anywhere else!
Don’t worry, we have your back! All our commissions are settled quickly. Your account will be credited with your commission every 15 days of policy issuance.
How to Become a Motor Insurance Agent?
The easiest way to become a vehicle insurance agent is by completing POSP certification. A POSP (Point of Sales Person) is the name given to an insurance agent who can sell specific insurance products.
To become a POSP, you only need to have the minimum educational qualifications required by the IRDAI and undergo training provided by us. Digit will take care of your training process. Don’t worry!
Requirements and Qualifications to Become a Motor Insurance Agent in India
If you want to know how to become a car insurance agent, you must be over 18 years of age, should have completed education up to at least Class 10, and have a valid Aadhaar Card and PAN Card.
You will be then be asked to complete compulsory 15-hour training specified by IRDAI. We promise to help you learn everything you need to know!
Who Can Become a Motor Insurance Agent?
The only requirement to become a motor insurance agent is that the candidate must be over 18 years of age and should have completed Class 10.
This means that anybody who has an aptitude for selling insurance policies can become a POSP Agent. This includes college students, stay-at-home spouses, retirees, and businessmen/women.
How to Become a Motor Insurance Agent/POSP with Digit?
Step 1
Sign up by filling our POSP form given above, fill all the details & upload required documents.
Step 2
Complete your 15-hour training with us.
Step 3
Complete the prescribed examination.
Step 4
Sign the agreement with us and that’s it! You’ll be a certified POSP.
How Much You Can Earn?
Your income as an insurance agent depends on the number of policies that you sell. The more the number of policies that you sell, the greater your income. A motor insurance agent can sell insurance policies for car, bike and commercial vehicles.
This means that you can sell both comprehensive and standalone policies to the customers, for which the commission structure is given below:
| Type of policy & vehicle | Age of the vehicle | The maximum rate of commission |
| Comprehensive policy - Four wheelers and other types of private or commercial vehicles | 1-3 years old | 15% of the own damage premium |
| Comprehensive policy - Two-wheelers | 1-3 years old | 17.5% of the own damage premium |
| Comprehensive policy - Four wheelers and other types of private or commercial vehicles | 4 years and above | 15% of own damage premium + 2.5% of third party premium |
| Comprehensive policy - Two-wheelers | 4 years and above | 17.5% of own damage premium + 2.5% of third party premium |
| Standalone Third-party liability policy - All types of vehicles | Any age | 2.5% of the premium |
Why Should You Become a Motor Insurance Agent?
One of the primary advantages of being a POSP is the freedom to work as per your convenience. You can now be your own boss!
You can decide whether you’d like to work fulltime or part-time and craft your own working hours accordingly.
At Digit Insurance, we primarily sell insurance policies online. This means, you as a POSP can work from home and use our online processes to sell and issue policies.
To certify as a POSP, one of the main criteria's is to complete the 15-hours compulsory training offered by the IRDAI; which isn’t much to be honest! All it is going to take you is 15 hours of investment to get on board!
Your earnings don’t rely on number of hours worked but on the number of policies you issue. To have a better understanding of the same.
Apart from having a smartphone, a good internet connection, and the required 15-hours training, there’s nothing else you need to become a POSP. So, there’s almost no monetary investment required from your end, whilst the earning potential is high.
FAQs about Becoming Vehicle Insurance Agent
What are the criteria to become a POSP agent?
If you want to become an insurance agent, you must be over 18 years of age, should have completed education up to at least Class 10th, and have a valid Aadhaar Card and PAN Card.
What documents do I need to submit?
The documents that you will need to submit at the time of registration include Class 10 or above pass certificate, a copy of your PAN card, Aadhaar Card (front and back), a cancelled cheque (with your name on it) and a photograph.
Do the PAN Card holder and Bank Account holder have to be the same?
Yes, all commissions paid are subject to TDS. TDS is credited to the Income Tax authorities based on your PAN Card.
When can I start selling motor insurance policies?
As soon as you have registered with us, you may begin your training for the POSP exam. On giving and passing the exam, you will receive an eCertificate. You are then ready to start selling insurance as a POSP agent.
Is it compulsory to undergo any training to become certified as a POS person?
Yes, you will have to complete the training to become a POSP. It will include topics ranging from basics of insurance, policy types, process for issuance and claims, rules and regulations etc.
What support services will I get if I partner with Digit?
All Digit’s partners are assigned a relationship manager who will provide guidance and answer any questions that agents might have on the policies sold over the Digit platform. Agents can also contact the customer support team by emailing us at partner@godigit.com for any assistance.
How can I keep enhancing my knowledge after completing the POSP certification?
We have another extensive training program conducted for our POSPs after certification.
They help in enhancing your insurance knowledge and improving your sales and servicing skills. These training programs and events will cover the following:
- Advanced insurance knowledge to handle complicated cases
- Keep abreast with the latest insurance products and how to pitch them
- Fun and interesting ways to learn various selling techniques which help in increasing your sales volumes
Do I need sales experience to become a Motor insurance agent?
Sales experience is definitely an advantage but even if you don't have any, you can still apply and make a career in this field.
What is the meaning and significance of POSP in the insurance industry?
POSP refers to ‘Point Of Sales Person’, an individual who can sell insurance products of various insurance brands. They can sell various insurance and be associated with many companies simultaneously.
What is the major difference between a POSP and an insurance agent?
The major difference between a POSP and an insurance agent is that the Insurance agent works under a single company, whereas a POSP can be associated with multiple companies simultaneously.
What are the various insurances a POSP can sell?
A POSP can sell all kinds of insurance, including health insurance, motor insurance, travel insurance, and personal accident coverage.
What is the required time after a POSP can start selling their products?
Once a POSP has completed their prescribed hours of training and passed an online examination, they can begin selling products.
How much commission do car insurance agents get?
The commission depends on the insurance company and the specific policy sold. Usually, agents receive a percentage of the premium paid by the policyholder, ranging from 10% to 20%.
Which is the most profitable insurance to buy?
Term insurance provides astounding coverage, such as death benefits, at pretty affordable premiums.
What is the maximum commission that an insurance agent can earn?
The maximum commission earned by an agent on general insurance and its products should not exceed the 20% mark.
Do the insurance agents have to pay taxes?
Insurance agents must also pay taxes and are subject to TDS under Section 194D of the Income Tax Act.
What is the TDS rate for car insurance?
The rate of TDS on the insurance commission of cars depends on whether the recipient is a domestic company or any other resident person. If the recipient is a domestic company, the rate is 10%, while for any other residents, it is 5%.
Which ITR is to be filed for the insurance commission?
The insurance agents earning commission for insurance are required to file ITR-3.
How do insurance agents earn a commission?
Whenever customers renew their insurance policy and pay the premium, their agent also receives a renewal insurance commission.