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Insurance Broker Due Diligence Checklist

Ensure compliance and mitigate risk! Our Insurance Broker Due Diligence Checklist streamlines your assessment process, covering everything from licensing to financial stability. Protect your business - download now!

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Broker Background & Licensing

1 of 10

Verify broker credentials and regulatory compliance.

Broker Name

Broker License Number

State(s) of Licensing

License Expiration Date

License Type

Copy of License Document

Number of Years in Business

Financial Stability & Solvency

2 of 10

Assess the broker's financial health and ability to fulfill obligations.

Annual Revenue

Net Profit/Loss (Last Year)

Current Ratio

Debt-to-Equity Ratio

Last Financial Statement Date

Financial Statement (Latest)

Credit Rating (if applicable)

Errors & Omissions (E&O) Insurance

3 of 10

Confirm adequate E&O coverage and current policy status.

Policy Effective Date

Policy Expiration Date

Policy Limit (Per Occurrence)

Policy Aggregate Limit

Insurer Name

Coverage Type

Notes/Comments on E&O Coverage

Upload E&O Insurance Certificate (PDF)

Regulatory History & Disciplinary Actions

4 of 10

Review past regulatory actions and compliance issues.

Date of Initial Regulatory Review

Regulatory Agency Involved

Description of Regulatory Action/Investigation

Type of Action

Amount of Fine (if applicable)

Date of Action/Order

Summary of Resolution/Outcome

Status of Action

Client Complaint History

5 of 10

Analyze client complaints and resolution processes.

Total Number of Complaints Received (Past 3 Years)

Summary of Complaint Trends (e.g., common issues)

Complaint Resolution Method (Most Common)

Average Resolution Time (in Days)

Complaint Categories (Select all that apply)

Date of Last Significant Complaint

Description of Complaint Handling Process

Compliance Program & Training

6 of 10

Evaluate the broker's compliance program and agent training.

Does the broker have a documented compliance program?

Last Compliance Program Review Date

Number of Agents/Brokers Requiring Training

What compliance topics are included in the training?

Date of Last Agent/Broker Training

Briefly describe the training methodology used (e.g., online modules, workshops)

Is training mandatory for all agents/brokers?

Upload a copy of the Compliance Program Manual (if available)

Contractual Agreements & Terms

7 of 10

Review contracts and agreements with the broker.

Summary of Key Contractual Terms

Contract Type

Contract Start Date

Contract Renewal Date

Commission Rate (Percentage)

Description of Indemnification Clauses

Governing Law

Upload Contract Document

Cybersecurity & Data Protection

8 of 10

Assess the broker's cybersecurity measures and data protection protocols.

Cybersecurity Framework Used (e.g., NIST, ISO 27001)

Summary of Cybersecurity Policies & Procedures

Data Encryption Method (at rest)

Data Encryption Method (in transit)

Frequency of Vulnerability Scanning (times per year)

Last Security Awareness Training Date

Cybersecurity Incident Response Plan (latest version)

Conflicts of Interest Disclosure

9 of 10

Ensure transparency regarding potential conflicts of interest.

Describe any existing relationships or affiliations that could create a conflict of interest.

Does the broker have ownership interest in any insurance companies?

Percentage of commission received from a specific insurer (if applicable)

Select all categories of potential conflicts of interest that apply:

If 'Other' was selected above, please specify the nature of the conflict.

Date of last conflict of interest disclosure review

Record Keeping & Documentation

10 of 10

Verify proper documentation and record-keeping practices.

Last Record Keeping Audit Date

Description of Record Retention Policy

Number of Active Client Files

Sample Client File (for review)

Record Storage Method

Date of Last Data Backup

Summary of Document Destruction Process

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