In the wake of Covid-19 pandemic and based on representations received from insurers, the Insurance Regulatory and Development Authority of India “IRDAI” has, through a Circular dated 10th September (Refer to attachment-Circular-1) granted exemption to insurers from the requirement of issuing policy document and copy of the proposal in physical form in respect of the following:
All Motor Insurance policies
Fire Insurance policies covering Dwellings and/or contents thereof issued to individuals
All package insurance policies issued to individuals (e.g. package policies for Dwellings)
All Miscellaneous policies issued to individuals where the Sum Insured does not exceed Rs. 5 Crore.
Consequently, through another Circular (Refer to attachment-Circular-2) exemption has been granted to all individual / retail health insurance policies issued by general and health insurance companies (the insurers) from the requirement to issue physical policy document and hard copy of proposal form.
The above exemption for issue of electronic policies has been granted subject to certain conditions such as:
Insurers shall send the policy document and a copy of the proposal form through digital/electronic mode. The documents shall be sent to the registered e-mail id or mobile number provided by the customer only on the specific consent provided by the policyholder.
Simultaneously the policyholders shall be informed through SMS that policy document /copy of the proposal form have been sent to their e-mail id or any other digital / electronic mode (as may be the case).
Insurers shall put in place proper mechanism to ensure that the documents are delivered to the designated e-mail Id / mobile number of the policyholder and an acknowledgement is appropriately obtained / auto-collected on delivery.
When documents are forwarded by electronic means, the record of policyholder having received the document or the electronic platform having delivered the documents shall be maintained systematically. It shall be clearly informed to the policyholder that the date of delivery of the document is reckoned for the purpose of examining free-look requests, wherever applicable.
Insurers shall preserve the records of such acknowledgements for further reference.
The policy document sent electronically shall contain all the schedules, terms and conditions, benefits etc that are otherwise available in the physical document.
Policyholders shall be also informed that printing of physical policy document and dispatch of the same along with the copy of proposal form may be delayed due to operational difficulties in the wake of ongoing COVID-19 pandemic situation.
Policyholders shall be informed that the policy document sent electronically is as valid as the physical policy contract / document.
Wherever policyholders demand the physical version of the policy document /copy of the proposal, the same shall be made available.
Furthermore, with regard to the requirement under *Regulation 8 (1) of IRDAI (Protection of Policyholders’ Interests) Regulations, 2017 in respect of proposal forms, Insurers have been allowed to obtain the customer’s consent without requiring wet signature on the hard copy of the proposal form subject to certain conditions such as:
The completed proposal form shall be sent to the prospect on his/ her registered e-mail ID or mobile number by means of a message with a link, as the case may be.
If the proposer wishes to give consent to the proposal, the same may be permitted by providing a link for confirmation or through One Time Password (OTP) duly validated.
Insurers shall maintain verifiable, legally valid evidence for the proposer’s consent received for the fully completed proposal form.
Insurers shall be responsible for the providing approved digital sales material to insurance agents/intermediaries and ensure that only that material is used while soliciting the business, authenticating the e-mail IDs / mobile. numbers of the proposers and ensuring the suitability of the product being sold.
The above exemptions granted shall be valid till 31st March 2021.
*Regulation 8 of IRDAI (Protection of Policyholders’ Interests) Regulations, 2017: Proposal for Insurance:
1. Except in case of a marine insurance cover, or such other covers approved by the Authority exempting usage of proposal form, a proposal for grant of insurance cover, either for life insurance business or for general insurance business or for health insurance business, must be evidenced by a document in written or electronic or any other format as approved by the Authority. It is the duty of the insurer to
Source: Insurance Regulatory and Development Authority of India
