Life Insurer Convert Policies to Demat Form.

The Insurance Regulatory and Development Authority (IRDA) recently sent a circular to all life insurers allowing a one month-extension to meet the criteria for conversion of a minimum number of policies into dematerialised (demat) form as part of a pilot scheme.

IRDA has licensed Karvy, NSDL Database, Central Insurance Repository, SHCIL Projects, and CAMS Repository Services as repositories.

The regulator had launched a two-month pilot project in July, making it mandatory for all life insurers to convert a minimum of 1,000 or five per cent of the total individual policies issued into demat format.

Viiveck Verma, ED, Karvy Insurance Repository, said some life insurance companies were not ready with the testing and technicalities of system integration due to which there was need for the deadline to be extended.

At present, according to industry estimates, the five insurance repositories have around two lakh e-insurance accounts and around 60,000 policies in dematerialised format. For the policies converted/ issued in electronic form, within an e-Insurance Account, the insurance repository is responsible for providing the mandatory information such as policy

status, history, premium dues with facility to print/download wherever necessary.

The CEO of a private life insurance company blamed the delay on slow customer feedback despite all the communication sent by the insurer.

“While it is a good model for the future, the number of insurance policies held by an individual is limited. So, he may not feel an immediate need to dematerialise the policy, unlike multiple securities that an individual may hold and trade.