Insurance companies advised to issue Digital Insurance Policies via DigiLocker

Insurance companies advised to issue Digital Insurance Policies via DigiLocker

New Delhi, February 14, 2021

The Insurance Regulatory Authority of India (IRDAI) has advised all insurance companies to issue Digital Insurance Policies via DigiLocker as it would It will lead to a better customer experience with faster claims processing and settlement, reduction in disputes and fraud.

An IRDAI circular dated February 9, 2021, said, "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 circular also mentions that 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.

The Digilocker team in NeGD (National e-Governance Division) under the Ministry of Electronics and Information Technology will provide necessary technical guidance and logistic support to facilitate the adoption of this facility, a press release from the Ministry of Electronics & Information Technology (MeitY) said.

Digilocker is an initiative under the Digital India programme by the MeitY 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 the effectiveness of service delivery, making this hassle-free for the citizens.

In the insurance sector, Digilocker will drive a reduction in costs, elimination of customer complaints relating to non-delivery of policy copy, improved turn around time of insurance services, faster claims processing and settlement, reduction in disputes, reduction in fraud and improvement in customer contact. On the whole, it is expected that will lead to better customer experience, the release said.

According to the release, the decision of IRDAI came in the backdrop of a letter written by Sanjay Dhotre, Minister of State for Electronics & IT to Anurag Singh Thakur, Minister of State for Finance and Corporate on issuing of digital insurance policies to citizens' 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 policyholders 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 safely and authentically and will be of a great value to their customers," he stated in the letter.

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