IRDAI (Insurance Regulatory and Development Authority of India) has asked insurers to issue digital policies to their policyholders and also tell them how to use these documents. The regulator said that the step will not only bring down the cost but also help speed up the claim settlement process.
In its circular issued to all insurers excluding GIC Re, Lloyd's (India) and FRBs (foreign re-insurance branches), IRDAI said that Digilocker will drive the reduction in costs, elimination of customer complaints relating to non-delivery of policy copy, an improved turnaround time of insurance services, faster claims processing and settlement, reduction in disputes, reduction in fraud and improvement in customer contactability.
On the whole, it is expected that it will lead to better customer experience, the regulator said adding that in order to promote the adoption of Digilocker in the insurance sector, the Authority advises all insurers to enable their IT systems to interact with Digilocker facility to enable policyholders to use Digilocker for preserving all their policy documents.
The insurers should inform their retail policyholders about Digilocker and how to use it. Insurers are also advised to enable the process by which the policyholders can place their policies in the Digilocker, said the regulator.
As per the circular, the Digilocker team in NeGD (National e-Governance Division) under the Ministry of Electronics and Information Technology will provide necessary technical guidance and logistic support to facilitate the adoption of Digilocker.