NEW DELHI: Insurance repositories will soon start servicing the health and motor-vehicles insurance policies, which will not only reduce the time for policy holder to get claims, but also reduce the premium cost, in addition to higher transparency and security for insurance firms.
Insurance repositories are entities that maintain the data of insurance policies in electronic form on behalf of insurers. Now, repositories cater to only the life insurance space.
“The government held discussions with the insurance firms recently and asked them to improve the customer service using the IR services... the government is keen to promote digital system and it is a step in that direction,” a senior official in Department of Finance Services in Ministry of Finance told Express.
“Policy holders will now pay fewer premiums with authenticity and transparency,” says S V Ramanan, CEO of Chennai-based CAMS Insurance Repository Services.
Electronically issuing policy reduces the cost, time and physical presence to assign (pledge the policy for loan or any other transaction). The move will help policy holders, with more and more insurance companies offering lower premium and discounts for safe driving (Bajaj General) and joining gym and health management spas (Cigna TTK).
“In Sri Lanka, if an accident happens the policy holder can take a picture and send it to the insurance firm to seek claims and does not need to wait for a surveyor. Such possibilities can happen in India if policies are serviced electronically,” says Ramanan.
Currently about six lakh life insurance policies are serviced by four IRs— CAMSRep, Karvy, NSDL and CDSL. The six lakh life policies in electronic format is a fraction of 37 crore policies with various insurance companies.
Notably, no public sector insurance firm has a tie-up with any of the four operators. While all 23 private insurance firms offering life policy products have signed up with the four IRS. “The discussions are on with them… but no final decision has been taken,” a senior official in Life Insurance Corporation told Express.