Press Information Bureau

Government of India

Ministry of Finance

26-March-2012 18:48 IST

No proposal to shift the insurance sector to a paperless model

Insurance Regulatory and Development Authority (IRDA) has reported that there is no proposal to shift the insurance sector to a paperless model. The insurance companies could continue to issue paper insurance policies. However, where an insurer issues e-insurance policies, the company shall do so at the option of the policyholder by utilising the services of an insurance repository licensed by the Authority. All such insurance policies in electronic form shall be treated as valid insurance contracts. The objective of an insurance repository is to provide policyholders a facility to keep insurance policies in electronic form and undertake changes, modifications and revisions in the insurance policy with speed and accuracy in order to bring efficiency, transparency and cost reduction in the issuance and maintenance of insurance policies.

Further, IRDA has informed that the following entities have been granted in-principle approval to act as insurance repositories to hold insurance policies in electronic form on behalf of policy holder : (i) NSDL Database Management Limited; (ii) CDSL Ventures Limited; (iii) Stockholding Corporation of India Limited; (iv) Karvy Consultants limited; and (v) CAMS Repository Services Limited.

The insurers issue the electronic policies only at the option of the policyholders thus the paperless model is unlikely to create inconvenience to the illiterate and rural population of remote villages.

This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to a question in Lok Sabha.

*****

DSM/SS/Hb

Electronic insurance policies allowed at policyholder option; repositories may hold valid electronic contracts, not replacing paper. Insurers may continue issuing paper policies; where electronic policies are issued, they must be at the option of the policyholder and held through a licensed insurance repository, and such electronic policies shall be treated as valid insurance contracts. Repositories aim to enable electronic storage and prompt, accurate policy maintenance to improve efficiency, transparency and reduce costs.