Conserve Trees… Welcome E Insurance Policies
Raghu: “I was just wondering Nitin, things would be so much simpler if insurance policies could be applied for online.”
Nitin: “But that is possible Raghu. You should have just asked for something else!”
Raghu: “What do you mean, Nitin?”
Nitin: “ The IRDA (Insurance Regulatory Development Authority) has made available the facility of an E-Insurance policy with Demat Facility in electronic form for people like us.
Raghu: “Wow Nitin! I wasn’t aware of this. Can you tell me more?”
Nitin: “Sure. This is what you need to know.”
We all know that E-Commerce has gained popularity in recent times.. E-commerce has also brought about E-Insurance policies, which means, now an insurer does not have to hold insurance paperwork. Instead, he would hold them in a Demat (Dematerialized) account in electronic form.
Advantages of holding an E-Insurance policy
- In case of modifications and revisions required in the policy, this facility ensures speed and accuracy and increases efficiency.
- It helps in reducing costs and works out to be more cost effective.
- It guarantees better transparency.
- It acts as a one-stop shop for the policy holder for making corrections or changes in personal details such as change of name, address etc.
- No extra charges are applicable for opening an E-Insurance account.
- Premiums can be paid online.
- With the electronic format, one can do away with the hassles of maintaining paperwork which can be easily misplaced, mutilated etc.
Requirements of an E-Insurance policy
The insurer needs to sign a service agreement with the insurance repository that holds a certificate of registration. Then, the policy holder will have only one E-insurance account which would include all other policies held by him such as accident, health etc.
In case of a minor, a legal and a natural guardian is required to take responsibility of the life of the minor and is also responsible for the insurance policy until the minor becomes an adult.
Process for applying an E-Policy
Documents of the policy holder such as address proof, PAN card etc. are required.
The KYC compliance depends if the policy holder plans to go through an insurer or directly approach a repository. If the repository is approached directly, they will carry out the due diligence to confirm the authenticity of the policy holder. In case he goes through an insurer, the insurance company will collect the documents on behalf of the repository. In such a case, the KYC (Know Your Customer) compliance will be scrapped to avoid duplication of paperwork.
A unique policy number is allotted to every insurance policy held in the E-Insurance Account.
All insurance repositories are expected to submit a statement of policies held in the demat form by the policy holder to his address once a year to the addressed mentioned. The statement should include the policy number, kind of policy, and the name of the insurer.