Third Party Administrator (TPA) License in India

A Third Party Administrator (TPA) License is a crucial certification required for entities that act as intermediaries between insurance companies and policyholders.

TPAs are responsible for managing health insurance claims, facilitating the smooth processing of claims, and ensuring that the policyholder’s needs are met effectively and efficiently. In a rapidly evolving healthcare landscape, having a TPA license enables businesses to operate within legal frameworks while delivering high-quality services to their clients.

A Third-Party Administrator License is a regulatory authorization issued by the Insurance Regulatory and Development Authority of India (IRDAI) that allows a company to function as a Third-Party Administrator (TPA). A TPA is a corporate entity that provides administrative and management services for health insurance policies on behalf of insurance companies.  

In the health insurance sector, TPAs serve as professional intermediaries that handle the operational aspects of policy servicing — particularly claims processing, cashless hospitalization facilitation, reimbursement management, network provider coordination, and customer support. By obtaining a TPA license, an organization becomes legally empowered to act in this capacity, enabling access to partnerships with multiple insurance companies and expanding service reach within the healthcare insurance ecosystem.  

Obtaining a TPA license ensures full legal compliance under IRDAI regulations, allowing your organization to operate without legal risks. It provides formal recognition, enabling partnerships with multiple insurance providers and access to a wider client base. Additionally, it establishes trust, credibility, and transparency, which are essential for maintaining strong relationships with policyholders, insurers, and healthcare networks while ensuring efficient and ethical claims of administration. 

Regulatory Compliance and Legal Recognition 

Operating as a TPA without a valid license is not allowed. A license ensures that your organization adheres to the IRDAI’s Third Party Administrators (Health Services) Regulations, providing legal backing and credibility within the industry.  

 Expanded Business Opportunities 

With a TPA license, your organization can enter contracts with multiple insurance providers, manage large portfolios of health insurance members, and serve diverse clients across regions. This enables scalability and business growth. 

 Enhanced Operational Standards

Licensed TPAs are expected to maintain operational excellence, quality service standards, and robust governance frameworks. This helps build trust with insurers, policyholders, and healthcare networks.  

Service Quality and Policyholder Trust 

Policyholders benefit from efficient and reliable claims handling, faster settlement processes, and accessible customer support, which in turn enhances overall satisfaction and brand reputation for both insurers and TPAs.  

Network Management

• Provider Network Development: Building and maintaining a robust network of hospitals, clinics, and healthcare providers to facilitate cashless treatment for policyholders.
• Quality Assurance: Monitoring the quality of services provided by network hospitals and ensuring compliance with health standards.

Health and Wellness Programs

• Preventive Care Initiatives: Implementing programs aimed at promoting health and wellness among policyholders.
• Health Education: Providing resources and information to help clients make informed healthcare decisions.

A licensed TPA can support insurers and policyholders across several critical functions within the health insurance value chain. The following are typical services provided by TPAs: 

TPAs act as professional intermediaries, managing claims processing, cashless hospitalization, policy administration, customer support, and network hospital coordination, while also providing data management, reporting, and value-added services that improve efficiency, transparency, and overall satisfaction for both insurers and policyholders across the healthcare ecosystem. 

 Claims Management 

TPAs manage the entire lifecycle of a health insurance claim, from initial submission and verification to final settlement. This includes processing documentation, coordinating with healthcare providers, and ensuring timely cashless or reimbursement of settlements.  

 Cashless Hospitalization Facilitation 

A major role of TPAs is to facilitate cashless treatment by coordinating directly with network hospitals, obtaining pre‑authorization, and managing approval of workflows so that policyholders need not pay upfront at the hospital.  

 Policy Administration and Support 

TPAs also help with policy enrolment, renewal processing, amendments, beneficiary updates, and periodic policy servicing tasks. 

 Customer Service and Education 

Dedicated customer support units help policyholders understand their coverage, resolve issues, guide claim documentation, and answer queries — contributing to improved policyholder experience.  

 Network Management and Provider Relations 

TPAs build and maintain a robust network of hospitals, diagnostic centers, and clinics that provide services under health insurance plans. They also monitor service quality and compliance standards.  

 Health and Wellness Programs 

Many TPAs partner with insurers and healthcare providers to offer preventive care initiatives, health education programs, and wellness campaigns to promote healthier lifestyles and reduce long‑term claim costs.  

 Regulatory Framework and Governing Laws

TPAs in India are governed by the Insurance Regulatory and Development Authority of India (Third Party Administrators—Health Services) Regulations, which set out the licensing, operational, compliance, and governance requirements that TPAs must follow. 

The IRDAI mandates that: 

• A TPA must be a company registered under the Companies Act, 2013.  

• The entity must have the primary objective of providing health services administration. 

• The name must include the words “Insurance TPA” to reflect its purpose clearly.  

• Minimum paid‑up share capital and net worth thresholds must be maintained.  

• Qualified personnel and adequate infrastructure must be in place to run operations efficiently.  

These regulations ensure that TPAs operate within a controlled, transparent, and high‑quality service environment, contributing to the integrity of India’s health insurance sector.  

To secure a TPA license from IRDAI, an applicant must meet specific eligibility criteria designed to ensure financial stability, operational readiness, and professional capability. These include: 

 Legal Entity Requirements 

The applicant should be a company registered under the Companies Act, 2013 with a valid Certificate of Incorporation. 

 Primary Business Objective 

The company’s main and exclusive objective must be to carry on TPA business for health services; it cannot undertake unrelated business activities. 

 Name Criteria 

The company’s name must include “Insurance TPA” to clearly reflect its business focus. 

 Capital and Financial Requirements 

• A minimum paid‑up share capital of ₹4 crores is typically required for a TPA license.  

• The TPA must maintain a net worth of at least ₹1 crore at all times during its registration period.  

Foreign Investment Compliance 

If the TPA includes foreign investment, it must comply with applicable FDI rules and IRDAI guidelines. 

Director Qualifications 

At least one director should possess an MBBS degree and be registered with the Medical Council of India or a state medical council; this requirement ensures appropriate medical oversight.  

Infrastructure and Staff 

The TPA needs adequate office infrastructure, trained staff, and operational systems to deliver services effectively.  

These conditions are designed to ensure that TPAs are structurally and financially equipped to handle complex healthcare and insurance processes with reliability and integrity. 

 Step‑by‑Step TPA License Application Process 

Obtaining a TPA license involves several key stages, each requiring careful preparation and regulatory compliance. Below is a structured licensing process:  

step:1 Prepare Your Legal Entity 

First, ensure your company is fully incorporated under the Companies Act, 2013 with all statutory compliance up to date.  

step:2 Define Your Business Plan 

Create a comprehensive business plan detailing your intended services, operational structure, staffing, hospital network strategy, and projected growth.  

step:3 Meet Financial Thresholds 

Ensure you have the required paid‑up capital and net worth in place, backed by audited financial statements. 

step:4 Gather Required Documentation 

Compile all necessary documents, including: 

• Certificate of Incorporation and MOA/AOA 

• Director credentials, KYC, and qualification certificates 

• Financial statements confirming capital and net worth 

• Business plan, infrastructure details, and staffing plan 

step:5 Submit Application to IRDAI 

File your license application through the IRDAI portal, paying applicable processing and registration fees, accompanied by the complete documentation pack.  

 step:6 Regulatory Evaluation and Queries 

IRDAI reviews the application, may raise inquiries, and request additional evidence of readiness. Responding accurately and promptly is crucial to avoid delays. 

step:7 License Approval and Issuance 

Once IRDAI is satisfied with eligibility and compliance, it grants the TPA license, enabling your company to commence operations as a licensed Third-Party Administrator.  

step:8 Renewal & Ongoing Compliance 

TPA licenses must be renewed periodically (often every three years) with updated documents and compliance reports submitted to IRDAI.  

This structured process ensures that only capable and compliant organizations operate as TPAs, maintaining service quality, and protecting policyholder interest.  

At Helios Global, we offer comprehensive and tailored support throughout your TPA license journey. Our services ensure clarity, compliance, and strategic success for your organization:  

 Consultation and Advisory 

We begin with detailed consultations to understand your vision, current operational setup, and business objectives. Our experts craft a customized licensing strategy that aligns with IRDAI’s regulatory framework, ensuring your application is both compliant and compelling. 

 Documentation Assistance 

Accurate and complete documentation is at the heart of a successful application. Helios Global assists with the preparation, review, and organization of all required documents, including financial statements, director profiles, infrastructure proof, and business narratives. 

 Application Submission Management 

We guide and manage the submission process to the IRDAI, ensuring that your application is filed correctly, on time, and with all requisite supporting materials. We also handle fee payments and portal interactions on your behalf. 

Compliance Management and Advisory 

Beyond initial submission, we help align your operational processes with IRDAI expectations. This includes regulatory compliance planning, governance frameworks, and risk management systems. 

 Post‑Registration Support 

Once your license is granted, Helios Global continues to support you with renewal planning, statutory reporting, operational compliance checks, and stakeholder management, helping you maintain a strong market position. 

 Operational Strategy and Growth Planning 

Our team also assists in designing service frameworks, network hospital relations, technology integration, and customer support systems — building your TPA into a scalable and efficient enterprise. 

Through these structured services, Helios Global ensures your TPA journey is seamless, compliant, and strategically aligned with your business goals.