
The winds of change are blowing through the Indian insurance landscape. As part of this change, you will no longer be able to buy traditional paper insurance from October onwards as a majority of policies will be issued in a digital format beginning 1 October 2016.
To maintain all your insurance policies in a digital format, you will need to have an e-Insurance Account (eIA), similar to demat accounts for shares and securities.
Insurance repositories and eIA
Currently, there are four insurance repositories in operation working as per the guidelines of Insurance Regulatory and Development Authority of India (IRDA) - CDSL Insurance Repository Limited (CDSL IR), Karvy Insurance repository Limited, National Insurance-policy Repository by NSDL Database Management Limited, and CAMS Repository Services Limited. As an insurance seeker, you can open an e-insurance account (eIA) with any of these approved insurance repositories. You can get your existing paper insurance policies converted into electronic form and link all your insurance policies with the same eIA account. Keep in mind though that you can have only one eIA at a time. You may, however, port your eIA from one repository to another if you wish.
eIA is a move to paperless and transparent insurance industry
The crux of going digital for insurance sector is to ensure that policyholders have a better real-time experience while buying, safekeeping, and renewing all their insurance policies. In the larger scheme of things, an eIA account for insurance makes all processes automated and transparent. Therefore, everything from filling up of the application form for insurance and making of payments for your policy premium, to the final issuance of the policy documents and eventual renewals, will be paperless and streamlined in real-time.
As per IRDA guidelines, all motor insurance and overseas travel insurance policies will henceforth be purchasable only in a demat form. So, this means if you have a car insurance policy coming up for renewal, you must open an e-insurance account to be able to renew your policy as per the 1 October deadline.
Insurance policies that require e-Insurance Account
If you are wondering which insurance policies require an e-insurance account, IRDA has issued clear guidelines on which policies would be mandatorily issued in a digitized format based on sum assured and the annual premium you pay for the insurance plan. So if your insurance plan falls into following criteria, opting for an e-insurance account is recommended:
1. You will need an e-insurance account for all motor and overseas travel insurance policies starting 1 October 2016.
2. Other insurance policies will also need an eIA account depending on the total sum assured or annual premium payable.
3. You can open an eIA account with any regulated insurance repository free of cost.
4. All your insurance plans will be linked to a single eIA account.
5. As an individual, you can only open one eIA account. However, you can port your eIA account from one repository to another.
The writer is General Counsel and Head of Compliance, BankBazaar.com