IRDA wants all its customers to move to a paperless world. The introduction of insurance repository system (IRS) is one such part of this initiative. An account called e-insurance account will be available for all customers who hold insurance policies. This is similar to demat account which was introduced for eliminating physical storage of stocks or mutual funds.
What is E-insurance account?
It is an account created for you to store all your insurance policies online at a single place. You can do it through an insurance repository which handles this account.
Who are the repositories?
IRDA has approved 5 repositories for the purpose of opening an e-insurance account. They are NSDL database management, central insurance repository, CAMS repository services, Karvy insurance repository and SHCIL projects. You can choose any of these repositories to open an account with them. However, multiple accounts are not allowed for an individual.
How to open it?
In order to open an e-insurance account, you have to fill and submit an application form to the insurance repository you have chosen. Along with it, you would also have to submit necessary documents such as identity proof, address proof and photographs.
What about existing policies?
Along with new policies, all existing insurance policies also can be a part of the e-insurance account. They need to be converted to demat form before they are transferred. This can be done by submitting a form along with the necessary documents.
Advantages of e-insurance account
The major benefit of holding an e-insurance account is that you can access all your policies at a single place without running the risk of losing documents. Previously, it was difficult to track all policies. Now, you can also pay premiums for different policies from a single place. You can modify or revise the policies with speed and accuracy. It will help increase transparency and also reduce the maintenance cost to some extent.
Any fees for opening and maintaining it?
The insurance repositories will have a tie up with various insurers. However, for a customer, opening an e-insurance account as well as its maintenance is absolutely free of cost.
It is a great move by IRDA as it signals transition of insurance from physical to digital format. It provides great comfort to customers who can access various policies upon single click of a mouse. Before purchasing any policy, they can refer to this account once and decide whether they need the new policy or not.