e-Insurance mandatory from 1-Oct – Should you convert your existing policies now?
As per IRDA e-Insurance Regulations 2016, new insurance policies should be issued in electronic mode from 1-Oct-2016 based on certain criteria. Even renewal of insurance policies has to be done in electronic mode. With such mandatory regulations coming from IRDA, now one needs to open e-insurance account. What is e-insurance account and what are its benefits? How to open e-insurance account? What is the process to convert existing policies into e-insurance? Should you convert your insurance policies?
What is e-Insurance account?
E-insurance or electric insurance is getting the insurance policy electronically. With eco-friendly concept of saving paper is in its full bloom, insurance is on its way to make the policy paper free. As we keep our financial securities in Demat account, in the same way we keep all our insurance policies in electronic form.
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As per IRDA e-Insurance regulations 2016, from 1st October 2016, most of the insurance policies will be issued in electronic form or even renewal of the existing policies. All types of insurance policies like travel, motor, health, life etc. are covered in this format.
Electric insurance policy will be issued if it meets the criteria of a limit in either sum assured or single or annual premium. But all the motor and overseas travel insurance are compulsory to be issued in electronic form.
IRDA has appointed 4 insurance repositories to open e-insurance account for policy holders. They are KARVY, CAMS, CDSL and NSDL. You can get your e insurance account opened in any of these companies. It is to be noted that one person can have only one e-insurance account.
What is the criteria where e-Insurance is mandatory?
- Sum assured in Term insurance exceeds Rs 10 Lakhs or premium exceeds Rs 10,000 per annum.
- Sum assured in ULIP/Endowment insurance exceeds Rs 1 Lakhs or premium exceeds Rs 10,000 per annum.
- Pension policies / Annuity plans where premium exceeds Rs 10,000 per annum.
What are the benefits of e-insurance?
Apart from cost saving benefits of the insurance companies, e-insurance is highly beneficial to policyholders also. Some of the key benefits are:
1) Safe custody
The prime benefit of the e-insurance account is the safe custody of the insurance policies. In the normal course of life, an individual possess 4-5 policies of varying nature like motor, health, home, accident, life, etc. e-insurance facilitates you of preserving, maintaining and saving the documents physically. It is much more hassle-free.
2) No destruction
The e-insurance documents will have no fear of fire, theft or destruction in natural calamities.
3) Unified view
E-insurance facilitates to view all your insurance accounts in a portfolio manner in just a few clicks. It provides you with a unified view.
4) No repeated KYCs
If you own an e-insurance account, there is no need to give the KYC forms again and again to the insurance companies to buy a new policy. You just need to quote your e-insurance account number in the proposal form. You don’t have to submit your identity proof or address proof to the insurance company. It will make the process speedy and hassle-free.
5) Change in information
E-insurance will make the management of policies much more comfortable. If you are required to change your personal information like bank details, address etc., you need not visit the different insurance companies personally. Changes can be requested through online directly.
6) No dealing with different companies
After getting the e-insurance account opened, you just need to contact your insurance repository for handling the matters like surrendering or claiming the policy.
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What is the process of opening e-insurance account?
The process of getting your e-insurance account opened is very straightforward. You can follow these simple steps to open e-insurance account.
- Get the form downloaded from the desired insurance repository website, you want to open your account.
- CAMS Website at this link
- NSDL National Insurance Repository Website
- CDSL Insurance Repository Website
- Karvy Insurance Repository
- Fill in the details
- Attach the self attested documents that have been asked like address proof, photo, photo ID etc. It should be noted that aadhar card or pan-card is compulsory to open your e-insurance account.
- Submit it the respective local or head office. You can also submit it to the approved person.
- Along with the basic details, you are also required to fill your bank account details too in order to get the maturity amount, bonuses and surrender proceeds directly in your account. Attach one canceled cheque of your bank account with your documents.
- You will also be asked to fill the details of Authorized representative (AR). He is the one who can operate your account on your behalf in case of demise or incapacity.
- After submission of documents, it takes around 7 working days for your repository company to open your e-insurance account. Once opened, you will receive an account number; welcome kit containing all information about its operations and your log in ID and password at your registered address.
- e-insurance is free of charge. There is no account opening fees. There are no maintenance charges as per IRDA website.
What is the procedure of conversion of existing insurance policies into e-insurance account?
It should be kept in mind that your repository company does not have powers to directly convert your policies unless requested. For conversion of existing insurance policies in the electronic form, you need to apply through a policy conversion form of the respective insurance repository. Once they receive your request, they forward it to the respective insurance company and after getting confirmation from insurance corporate, your policy is converted.
Also Read: ICICI Pru iProtect Smart Term Insurance Plan – Is this a smart term plan?
Should you convert your existing policies into e-Insurance Account now?
First of all, IRDA e-Insurance regulations 2016 is making it mandatory to have e-insurance account for all new policies which meets certain criteria. Second, is all renewal of insurance policies would happen through e-insurance only based on the limits indicated. Hence there is no choice left for any of us except to open e-Insurance account. Considering all the benefits available in e-insurance account, I don’t think any reason for us to delay in opening it.
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Suresh
e-Insurance mandatory from 1-Oct – Should you convert your existing policies now
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Thanks for this information but how is it benefit if we convert individual policy to E policy under NSDL ?
I have opened e Insurance account with NSDL, I had provided my account opening form to SBI LIFE INSURANCE and they converted the policy along with the account creation. Unfortunately, they misspelled my name also the address was not correct, because of that I had to contact the Authorized Person (AP) to rectify the same. These Al's have no clue about the e insurance account. Fortunately I called the NSDL customer service and they helped me in this case. It's always best to directly contact the repositories, I have zero faith in these half literate APs.
CAMS repository is good one to open eIA account compared to Karvy or NSDL as it has very good online platform.
good to know that Dr. Prakash
Very good article, informative…Thank you.
Thanks Bobby. Pls share this article with your friends you might not be aware
Dear Suresh,
Thanks for your article. I have already converted my policies into e-format
with CAMS, Pondicherry 2 years back itself but still my LIC Policy (No.735665776)
not yet converted and still shown by CAMS that they are co-ordinating with LIC.
I don’t know whose fault the delay is either from CAMS or by LIC – because of these
non-cooperation, I feel the purpose of the scheme won’t be a success one.
S. Ravi Chandiran
what is the cost involved in maintaining e-insurance in demat format annually or onetime ???Is this scheme is cost free scheme???
Thank you so much for this article.
Really its very useful..thank you sureshji
Really its very useful..thank you sureshji.
Regarding the charges nothing mentioned
Binoy, there are no account opening charges or maintenance charges. Thanks. I have updated this point in the article
Very useful article
Is it only for life insurance policies? Do we need to open even if we have a LIC policy? i am not seeing LIC in any of the service list of the CAMS, KARVY,..
Ramesh, Its for all policies based on the limits indicated in the article.
Dear Mr Suresh
Which out of the four would you recommend for opening e account.
Regards
Gp Capt BS Bhullar
Even I am yet to open. Readers are giving recommendations, let us see Capt.Balraj