The Insurance Regulatory and Development Authority of India (IRDAI) has introduced a proposal to make all insurance policies mandatory in Digital form. If this proposal is approved, all new policies will be issued in electronic form only. Simultaneously, it has asked the insurance companies to propose to provide the facility of e-insurance to the existing policyholders.
Irdai has also said that insurers should give a discount if the customer buys the policy directly from the electronic platform. Advice has been sought from the concerned shareholders regarding this proposed guideline by October 20.
Irdai recently reviewed the existing norms for the issuance of e-policy. It also proposed some changes. In the draft released on September 29, Irdai said a suitable framework has to be put in place to promote the insurance business and enable insurers to adopt the technology. In this, along with the physical form, the e-form will also have to be given to the companies.
Irdai said, every insurance company will issue all insurance policies only in electronic form, whether the offer is received through e-mode or otherwise. The e-Proposal received directly through the insurance intermediary will be approved through an electronic platform only. Insurance companies have to set up mechanisms to transfer any information if it is in physical form, or in electronic form.
Irdai said that Electronic Insurance Account (EIA) will be mandatory for all policyholders. Policyholders will have to keep the issued policy in the EIA. Every insurance company should have a device to generate an EIA number. Insurance companies will have to send a copy of the e-insurance policy and offer form, benefits, and other relevant documents to the customers’ email.
Each insurance company, upon issuance of an electronic policy to the EIA, will inform the policyholders through SMS on the email id, and mobile number. It has to be given in Hindi, English, and other regional languages. The insurance companies will have to facilitate the conversion of all existing policyholders to e-policy within one year from the date of coming into force of this rule.