A Third Party Administrator license lets companies handle health insurance work for insurance companies. The Third Party Administrator helps process claims, approves hospital treatments, and supports customers.
To become a TPA, companies need permission from IRDAI (Insurance Regulatory and Development Authority of India). You must follow rules, submit papers, and pay fees. Knowing this process helps companies start work legally.
Understanding the Work of Third Party Administrators
Third Party Administrators works for insurance companies, but it helps both insurers and patients. A TPA checks insurance claims, allows hospital treatments without delays, and keeps customer records.
This allows insurance companies to focus on selling policies. IRDAI made rules in 2016 for TPA companies in India that no company can work as a TPA without IRDAI permission. These rules keep customers safe and protect their information.
Eligibility Criteria for TPA Registration
Companies must meet certain conditions before applying for a Third Party Administrator License.
Company Structure
Only a company incorporated under the Companies Act, 2013[1] may apply for a TPA licence. After registration, the company’s principal or sole business shall be the provision of TPA health services, and it must not carry on unrelated business activities.
The company name must include the words ‘Insurance TPA’. This is mandatory under IRDAI rules and reinforces the requirement that the company’s primary activity be TPA health services only.
Key Personnel
The TPA must appoint qualified key management personnel as per IRDAI requirements. The Chief Medical Officer must hold an MBBS degree and be registered with the relevant Medical Council. IRDAI does not mandate that any director must be a doctor, but the CMO must meet the prescribed medical qualifications.
Office and Technology
The TPA must have a proper office, trained workers, and safe computer systems. They also need strong measures to protect data and a plan to keep the business running during emergencies.
Minimum Capital
The minimum paid-up equity share capital must be ₹4 crore. The TPA’s net worth must not fall below ₹1 crore at any time during the registration period.
Document Requirements for TPA License Application
Applying companies must submit these documents with their application.
Company Documents
Submit your company registration certificate from ROC. Include your Memorandum and Articles of Association. Submit your PAN certificate and shareholding details signed by a Chartered Accountant.
Financial Documents
Submit financial statements for three years. New companies must submit their latest financial statements. Include a net worth certificate from a Chartered Accountant showing they have enough capital.
Personnel Documents
Submit details of all directors with their education and experience. Include information about company CEO, CAO, and CMO with their certificates. For the medical officer, submit medical degree and Medical Council registration.
Application Form
Form TPA-1 must be completed and submitted through the IRDAI Business Application Portal. The form must be signed by two directors of the applicant company and accompanied by the business plan and details of proposed services.
Technology Documents
Describe computers, servers, and security systems. Explain where your website is kept and who manages it, and share details about your website content.
Step-by-Step Process to Get Third Party Administrator License
Follow these steps to get TPA license.
Register on IRDAI Portal
Register and log on to the IRDAI Business Application Portal (BAP). Complete the online application for TPA registration and upload all required documents. IRDAI may request additional documents during review, which must be submitted online within the specified period.
Complete Application Form
Download Form TPA-1 from IRDAI official portal. Fill all parts with correct information about your company, directors, and services. Collect all needed documents.
Submit Application and Pay Processing Fee
Submit your application online using the IRDAI portal. You must pay a processing fee of ₹1,00,000 plus tax. This fee is not refundable. After your application is approved, pay a registration fee of ₹2,00,000 plus tax. Once this payment is made, IRDAI will issue your Certificate of Registration.
Get Certificate and Start Business
IRDAI gives you a Certificate of Registration. Put it in your office where customers can see it. The TPA must commence its operations within 12 months from the date of grant of the Certificate of Registration.
Fee Structure for TPA Registration
| Fee Type | Amount | Details |
| Processing Fee | Rs. 1,00,000 + GST | Pay with application (not returned) |
| Registration Fee | Rs. 2,00,000 + GST | Pay after approval |
| Renewal Fee (3 years) | Rs. 1,50,000 + GST | Needed to keep working |
Certificate Validity and Renewal
Your TPA license works for three years. After three years, you must renew it to keep working. Renewal fee is Rs. 1,50,000 plus GST.
Apply for renewal between 180 days and 30 days before your certificate ends. Late renewal costs extra money. Give updated financial and people information with renewal.
What TPAs Cannot Do?
IRDAI rules say what TPAs cannot do.
- TPAs cannot pay claims directly to hospitals or patients. Only insurance companies make payments. TPAs only suggest if claims should be approved.
- TPAs cannot say no to claims on their own. Only insurance companies can reject claims. TPAs check claims and send suggestions to insurers.
- TPAs cannot work with other insurance types. They work only with health insurance. They cannot handle life, car, or home insurance.
- TPAs cannot ask people to buy insurance. They cannot advertise insurance products. Their job is only to process claims and help with paperwork.
When IRDAI Can Cancel the License?
In some cases, IRDAI can cancel your TPA license.
- If the TPA fails to maintain the minimum paid-up equity share capital of Rs. 4 crore or if its net worth falls below Rs. 1 crore, IRDAI may suspend or cancel the licence.
- If you break IRDAI rules, your license may be cancelled. Breaking rules means missing claim deadlines, not protecting customer data, or giving wrong information.
- If you do not pay fees or penalties, IRDAI can cancel your TPA license. You must pay all fees on time.
Also Read: PSARA License Registration for Security Agencies in India
