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Now, SECURE your INSURANCE policies in demat form
Just like investors holding dematerialised shares with depository participants, individual insurance policyholders will be able to stack their insurance policies too in electronic form very soon, thanks to some path breaking initiatives by the insurance regulator, Insurance Regulatory Development Authority.
Here's every bit of information – the what, when, how etc – you would want to know about an entity called the Insurance Repository where insurance policyholders will be able to keep all their insurance policies in a demat-type account.
What is an Insurance Repository?
An Insurance Repository, IR, is a facility to help policyholders buy and keep insurance policies in electronic form, rather than as a paper document.
Insurance Repositories, like Share Depositories or Mutual Fund Transfer Agencies, will hold electronic records of insurance policies issued to individuals and such policies are called 'electronic policies' or 'e Policies'.
Courtesy: CAMS
CAMS is one of five shortlisted entities by IRDA to set up Insurance Repository.
Now, SECURE your INSURANCE policies in demat form
Can anyone become or set up an Insurance Repository?
No, only entities approved by Insurance Regulatory and Development Authority (IRDA) can become an Insurance Repository.
Insurance companies cannot set up an Insurance Repository on own nor can they hold more than 10 per cent stake in any Insurance Repository.
When will these IRs become operational?
All formalities including inspection by IRDA to verify the state of readiness of the Repositories have been completed. The IRs are expected to be operational post issuance of Certificate of Registration by IRDA.
This is likely to happen sometime in mid or end April 2012.
Now, SECURE your INSURANCE policies in demat form
How did these IRs come into existence?
IRDA had issued guidelines for the setting up of IRs and had subsequently floated a RFP request for proposal) inviting interested parties to apply for setting up an IR.
After satisfying itself on the qualifications of the parties that applied, IRDA short listed five entities and issued 'in-principle' approval for setting up IRs.
Who are these five IRs offering the service?
CAMSRep (CAMS Repository Services Ltd), Central Insurance Repository, NSDL Data Management, Karvy Insurance Repository & SHCIL Projects.
Now, SECURE your INSURANCE policies in demat form
What is an e Insurance Account (e IA)?
A policyholder needs to open an e Insurance Account (e IA) with one of the Insurance Repositories to be able to buy and keep policies in electronic mode. An individual can have only one e IA with any one of the Insurance Repositories.
Once an e IA is opened, the account holder can buy and keep all his electronic insurance policies -- be it life, pension, health or general -- issued by various insurers under this single account.
Each e IA will have a unique e Insurance Account number; the account holder should quote this number in all correspondence with Insurance Repository.
Each account holder will also get an unique Login ID and Password to access his account and electronic policy details online on the insurance repository website.
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What are the benefits of holding Insurance Policies in electronic form?
There are multiple benefits in holding insurance policies in electronic form under a single e Insurance Account (e IA). These benefits include:
Safety: There is no risk of loss or damage of a policy as may happen with paper policies; the electronic form ensures that the policies are in safe custody and can be easily accessed when needed.
Convenience: All insurance policies, be it life, pension, health or general, can be electronically held under a single e IA. This means all details of all policies are available in a single account (place). The details of any of the policies can be accessed at any time by logging on to the online portal of Insurance Repository. Premium for all the policies can be paid online and many service requests or complaints can be logged at this website.
Single Point of Service: All service requests in respect of e IA or any of the electronic policies held under the e IA can be submitted at any of the Insurance Repository service points -- there is no need to go to the offices of individual insurance companies for service.
Less paper work: When you want to buy a new electronic insurance policy under an existing e IA, you don't need to go through KYC verification all over again, if there are no changes to your KYC details already recorded in your e IA.
Further, if you want to make any changes to your personal details like address or contact no, it is enough to change the details in your e IA with the Insurance Repository by submitting a single request -- the Insurance Repository, in turn, will inform all the insurance companies with whom you hold electronic policies, about the changes.
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How do I open an e Insurance Account (eIA)?
To open an e IA, you need the fill out an account opening application form of the Insurance Repository along with the necessary supporting documents. Application Forms would be available in all offices of the Insurance Repository, once they are operational.
They can also be downloaded from the respective website or you can fill out an application online at the website). You can also contact your Insurance Advisor (Agent) for an application form.
You can submit the signed e IA application form at any Insurance Repository office. If you are applying to open an e IA at the time of buying a new Insurance Policy, it may be best to hand over the e IA form, along with the insurance proposal form, to the insurance company.
To open an e IA, you need to necessarily have either a PAN or Aadhar number. When submitting your e IA application, please ensure that you provide copies of your PAN or Aadhar, Address Proof and proof of date of birth, along with a passport size photograph. You also need to show the original address proof for verification (the list of acceptable address proof documents is given elsewhere).
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What are the documents required to open an e IA Account?
ID proof:
Aadhar Card or PAN Card
Address proof:
A copy of any one of the following documents should be submitted as proof of address; the original of the relevant address proof should be produced for verification by the Insurance Repository:
I. Ration card
II. Passport
III. Aadhar letter
IV. Voter ID card
V. Driving license
VI. Bank passbook (not more than 6 months old)
VII. Verified copies of:
a) Electricity bills (not more than 6 months old),
b) Residence Telephone bills (not more than 6 months old) and
c) Registered Lease and License agreement / Agreement for sale.
VIII. Self-declaration by High Court and Supreme Court judges, giving the new address in respect of their own accounts.
IX. Identity card/document with address, issued by:
a) Central/State Government and its Departments,
b) Statutory/Regulatory Authorities,
c) Public Sector Undertakings,
d) Scheduled Commercial Banks,
e) Public Financial Institutions,
f) Colleges affiliated to universities; and
g) Professional Bodies such as ICAI, ICWAI, Bar Council etc. to their Members.
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How long will it take for the Insurance Repository to open AN e Insurance Account?
The Insurance Repository will open an e Insurance Account within 7 business days from the date of receiving the e IA application form. On opening the e IA, the Insurance Repository will inform the applicant the particulars of the e Insurance Account and usage instructions through e-mail and by post.
What is the fee I need to pay for opening an e Insurance Account?
e Insurance Account is absolutely FREE to the policyholder -- the policyholder does not have to pay anything to open an e Insurance Account.
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What do I need to pay to maintain electronic policies in my e IA? And what is the fee for converting my existing paper polices into electronic policies?
All the services provided by Insurance Repositories are absolutely FREE of charge to policyholders. Policyholders need not pay anything extra to buy an electronic policy or to convert an existing paper policy into electronic form. Similarly they need not pay anything to avail of any services from the Insurance Repository, including online premium payment and services at the respective online portal.
How can Insurance Repository provide free service to policyholders? Where is the catch?
The Insurance Repositories will be paid directly by the insurance companies whose policies are held in electronic form in the respective Insurance Repository so that no charges are levied on policyholders. Insurance companies will be able to pay these fees out of the savings that will accrue to them by the migration to issuance and maintenance of policies in electronic form.
Now, SECURE your INSURANCE policies in demat form
What do I do if I need to make any changes to my policy or e IA? Do I submit a request to the Insurance Company or to the Insurance Repository?
It is best to submit ALL requests in respect of either your e IA or any of your electronic policies to the Insurance Repository. If the changes are with respect to an account level detail (like address or phone number), the Insurance Repository will execute the change after the necessary KYC verification, if any.
The Insurance Repository will then intimate the changes to all the insurance companies whose policies are held in that e IA, so that the changes are effected in all the policies, in one go (so there is no need for the policyholder to approach the various insurance companies individually for the changes).
In case of any changes at the policy level, the Insurance Repository is expected to forward the request to the respective insurance company and ensure that the same is executed and reflected in the electronic policy held with the Insurance Repository.
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Can policyholders have multiple e Insurance Accounts if they have multiple Insurance policies issued by various insurance companies?
No. IRDA stipulates that an individual can have only ONE e Insurance Account across Repositories, irrespective of the number of policies owned by a policyholder. All Repositories will have systems in place to check this before opening an e IA -- any application for a second or multiple e IA will be rejected by the Insurance Repository. All the electronic policies owned by a policyholder can be credited or held under this single e IA.
Which insurance policies can be held in electronic form?
The following types of insurance policies are eligible to be held in electronic form:
(a) All individual life insurance policies including health and pension policies. Policies issued to groups by registered life insurance companies can also be held in electronic form
(b) All general insurance policies held by individuals including group policies
(c) Any other class of insurance policies that may be notified by IRDA from time to time
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If I already have an e IA, how do I buy a new policy in electronic form?
Once you have opened an e Insurance Account, it is quite simple to buy a new policy in electronic form. You just need to quote your unique e IA Number in your new insurance proposal form, with a request to issue policy in electronic form.
Since KYC documents had already been submitted and verified when you opened your e IA, the Insurer will not do KYC again, provided there has been no change to your KYC details, making the process simpler and convenient for you.
How do I convert my existing paper policy into electronic form?
On opening an e IA, you just need to write out a request, addressed to the Insurer, for converting your existing paper policy to electronic mode. Request Forms for policy conversion are available in all offices of the respective Insurance Repositories. They can also be downloaded from respective websites.
You need to fill out a separate request for each paper policy that you wish to convert to electronic form. These requests, duly signed, can be submitted at the respective Insurance Company or at any Insurance Repository office.
If you do not have an e IA, you can submit an e IA opening form with the necessary supporting documents along with the request for converting paper policy to electronic mode.
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Can the policyholder operate the e IA only?
Yes, the e IA can be operated by the accountholder only during his life time, unless, of course, he has been unfortunately rendered incapable to operate it (incapacity due to mentally unsound means or terminally ill as certified by a medical practitioner).
In such circumstances, the e IA may be operated by the Authorised Representative (AR) appointed by the account holder.
The accountholder is strongly advised to keep the log in ID and password for online access of her/his e IA confidential and not share it with anyone else.
Who is an Authorised Representative (AR)?
A policyholder who opens an e IA shall appoint an Authorised Representative (AR) who shall be entitled to access the account in the event of demise of the policyholder or in her/his incapacity to operate the e Insurance Account.
The AR is entitled only to access the e IA so as to know the portfolio of insurance policies and the nominees of the respective policies held under that account. The policyholder can change the AR, at her/his discretion, during the term of the e IA. The AR is different from a nominee and has only access rights to the e IA in the event of demise of the policyholder.
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Is it compulsory for all insurance companies to offer electronic policies?
Yes. It is the policyholder's prerogative to opt for a policy in electronic form. If a policyholder wants his/her policy (either new or existing) in electronic form, then the insurer is bound to fulfill his/her requirement.
The choice of a Repository for opening an e IA is the prerogative of the policyholder and hence all insurance companies will need to work with all the Insurance Repositories.
Initially, repository service will be available for life insurance only; over time, health and general insurance (personal lines only) will also be brought within the ambit of repository services.
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Is it compulsory to issue policies in only electronic form (that is, is dematerialisation of insurance policies compulsory, as in the case of shares)?
No, it is not (yet) compulsory to issue insurance policies only in electronic form.
Policyholders can choose the form in which they want their policies issued -- paper or electronic.
Can a policyholder have both paper and electronic policies?
Policyholders can choose the form in which they want their policies issued -- paper or electronic. A policy can be bought or maintained in one form only -- either in electronic form or paper but not in both.
However, a policyholder can choose to keep some policies in electronic form and others in paper form -- only the electronic policies will be reflected in his e IA account and s/he can use repository services only for the e policies (and not the paper policies).