The Insurance Regulatory and Development Authority (Irda) has launched a two-month pilot to help the industry and policyholders get attuned to the system of an insurance repository.
During the pilot, each life insurer will have to convert a minimum of 1,000, or 5% of existing individual policies, into electronic form. Insurers cannot deny any request for electronic policy — both for conversion of existing policies and for issuing new ones.
The repository will contain information related to policy status, including premium, NAV, bonus, claims and nominees. It will give details of premium and transaction history and send SMS alerts for premium due and update.
During the pilot launch period, for every new policy sold, the insurer will collect the required details and consent for opening an Electronic Insurance Account. The policyholder can choose one from five repositories. The repository will conduct the know-your-customer (KYC) validation; if the KYC evidence is provided by the insurer, the repository will have to validate it. The repository will provide electronic access to the policyholder and communicate the details to the insurer.
Irda launched the project after it came across various problems being faced by the repositories.
One critical issue is the failure to arrive at a price structure between the repositories and insurance companies that is commensurate with the services being offered and volumes involved.
As per the requirements, an accountholder will have to fill out an e-insurance form, submit photo and address proofs, a photograph and a cancelled cheque for ECS/NEFT services for insurance premium payment. The regulator has given a list of KYC documents, such as PAN card, UID card for identity proof and ration card, and passport, aadhaar card, voter ID card or driving licence for address proof.
For existing customers, the insurance company will receive an application for opening of an electronic insurance account and forward it to the repository. The KYC validation will be done by the repository and it will provide electronic access to the policyholder. For the free-look period, the date of receipt of the welcome kit from the repository, along with details to log on to the e-insurance account, will be considered.
If an existing policyholder wants buy a new policy in the electronic form, he would just need to quote the e-insurance account number in the new insurance proposal form and make a request for issuance of the policy. The repository will send an email and SMS on your registered email