Life insurance companies will be required to mandatorily issue an electronic insurance policy for any individual who takes a sum assured of Rs 10 lakh and above, or pays annual premium of Rs 10,000 and above in life insurance. The Insurance Regulatory and Development Authority of India (IRDAI), in its guidelines on issuance of electronic policies, said that an insurer can also discount in the premium rates to the policyholders for electronic insurance policies.
In general insurance, for individual health policies of Rs 5 lakh and above, or annual premium of Rs 5,000 and above are required to be offered in e-format. In retail motor as well as individual overseas travel, all policies will be electronic. For other retail general insurance policies, the cut-off is sum assured of Rs 10 lakh and above or annual premium of Rs 5,000 and above.
Here, micro-insurance policy are exempt from being offered in electronic format. IRDAI said that electronic policies can be issued by the insurers either directly to the policyholders or through the registered insurance repositories. It also said that every insurer shall mandatorily issue e-insurance policies in disaster prone and vulnerable areas as specified by it.
IRDAI, however, said that all policies issued in electronic form by the insurer directly to the policyholder would also have to be issued in physical form unless it is given an exemption. Those policyholders who wish to avail the facility of electronic insurance policy can do so by registering their choice with the insurer.