Using Aadhaar For Insurance KYC- Few Pointers To Note

The insurance regulator IRDAI stipulates the mandatory KYC to be done for customers in case of direct sales of life insurance products. This is done so as to avoid any instances of money laundering in the system. For sales through other channels such as online, KYC or Know Your Customer through which customer's identity is verified is to be completed within 15 days of the sale of the insurance product.

For other insurance products such as health and motor insurance, KYC is to be executed at the time of claim settlement in case the amount is over Rs. 1 lakh as per the anti-money laundering guidelines of the regulatory body.

Now, after Aadhaar has emerged as an essential ID in nearly every sphere including financial transactions as well as to avail different social schemes. KYC with Aadhaar in insurance is also given a go ahead and now the regulator has said that Aadhaar is alone sufficient to complete the KYC process.

So, this means no other documents shall be needed as proof for identity, address or date of birth in case you furnish your unique Aadhaar ID to the insurance authority for KYC. Nonetheless, in case there is some discrepancy in your aadhaar such as photo is not clear or there is some mismatch in name or some other field, the insurer can ask for additional documents. So, for using aadhaar as the KYC document for buying insurance ensure that it is updated with proper details.

Also, an aadhaar based e-KYC can be done only with prior permission or consent of the consumer.

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