The regulator is meeting the heads of all life and companies on Wednesday to discuss dematerialisation of policies, a move aimed at increasing customer convenience.


Dematerialisation means converting physical documents into a modifiable online format.


This initiative was started by the insurance regulator a few years back, but did not take off as the operational challenges and associated cost for insurers outweighed the customer convenience it was supposed to provide.


The regulator now wants to revive the idea and will be holding consultations with insurance companies, discussing the pros and the cons of the facility and examining the reasons for the little interest in it.


Dematerialisation of life insurance policies is being promoted by the insurance regulatory and development authority of India (Irdai) to ensure a robust electronic mode of policy solicitation, servicing, and storage. Insurance repositories were set up with the aim of opening an eIA (e-Insurance Account), which would serve as a repository of all insurance policies of a customer.


Currently, there are four insurance repositories – National Insurance Repository, Insurance Repository Ltd, Karvy Insurance Repository Ltd, CAMS Insurance Repository Services Ltd.


Dematerialisation of insurance policies is essentially like dematerialisation of shares, the only difference being that in the case of shares, customers are allowed to transact, as in buy and sell shares. This feature is, however, not allowed in dematerialised insurance policies. It will simply provide a one-stop window for customers to view all their insurance policies–life, motor, or health. When a customer buys a policy, the insurance company will credit that policy in the customer’s repository account.


had initiated dematerialisation of insurance policies some time back, but its uptake was not satisfactory. The regulator has said all existing customers have to be transferred to repositories within the next 12 months. It is going to be a challenge for large insurers because of their customer base. It will be an added cost for them as this will be an operational challenge. But it will add to customer convenience,” said Vignesh Shahane, MD&CEO, Ageas Federal Life Insurance.


Atri Chakraborty, Chief Operating Officer, IndiaFirst Life Insurance, said, “ has issued draft guidelines where it is mandating all insurers to issue eIA to promote digital adoption. There are commercials that have been agreed between IRs and insurance companies for each transaction type and the commercial would vary based on transaction volume. As the adoption of eIA increases, the unit transaction cost would reduce and hence commercials would evolve over a period of time.”


“It’s beneficial to the customers, since they would have one eIA, which can serve as their repository for life, general and health insurance policies. The IRs also have the capability to transact and carry out service requests of customers pertaining to their policies.”



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