The regulator has reasoned that the step will not only bring down the cost but also help speed up claim settlement process
Insurance sector regulator Irdai has asked insurers to issue digital policies to their policyholders and also tell them how to use these documents. The regulator has reasoned that the step will not only bring down the cost but also help speed up claim settlement process.
In its circular issued to all insurers excluding GIC Re, Lloyd’s (India) and FRBs (foreign re-insurance branches), Irdai said that Digilocker will drive reduction in costs, elimination of customer complaints relating to non-delivery of policy copy, improved turnaround time of insurance services, faster claims processing and settlement, reduction in disputes, reduction in fraud and improvement in customer contactability.
On the whole it is expected that it will lead to better customer experience, said the Insurance Regulatory and Development Authority of India (Irdai). In order to promote the adoption of Digilocker in the insurance sector, the Authority advises all insurers to enable their IT systems to interact with Digilocker facility to enable policyholders to use Digilocker for preserving all their policy documents.
The insurers should inform their retail policyholders about Digilocker and how to use it. Insurers are also advised to enable the process by which the policyholders can place their policies in the digilocker, said the regulator. As per the circular, the Digilocker team in NeGD (National e-Governance Division) under Ministry of Electronics and Information Technology will provide necessary technical guidance and logistic support to facilitate adoption of Digilocker.
Digilocker is an initiative under the Digital India programme by the government where citizens can get authentic documents/ certificate in digital format from original issuers of these certificates. It aims at eliminating or minimising the use of physical documents and will enhance effectiveness of service delivery, making these hassle free and friendly for the citizens.
Notably, the decision of Irdai has came against the backdrop of a letter written by Sanjay Dhotre, Minister of State for Electronics & IT, Communications and Human Resource Development, to Anurag Singh Thakur, Minister of State for Finance and Corporate Affairs with regards to issuance of digital insurance policies to citizen’s DigiLocker accounts.
In the letter, Dhotre had requested Thakur to advise Irdai to issue an advisory to all insurance companies to make available the digital insurance policy of all policy holders via their Digilocker account and acceptance of Digilocker issued documents as valid documents.
“This will provide an alternate channel to access and manage all their insurance policies in a safe and authentic manner and will be of a great value to their customers,” Dhotre had written in the letter.
