Dispensing with physical signatures on insurance proposal forms: IRDAI extends timeline
Signatures on Insurance Proposal Forms the rule will apply to all insurance products sold by individual agents and insurance intermediaries.
The Insurance Regulatory and Development Authority of India (IRDAI) has allow life insurance.
Health insurance companies to obtain the consent of the buyers of insurance policies through electronic means i.e.
Without requiring a wet Signatures on Insurance Proposal Forms form till 30th September 2021.
Earlier such mandate was provide to the insurers till 31st March 2021.
The rule will apply to all insurance products sold by individual agents & insurance intermediaries.
The suitability assessment, benefit illustration (wherever applicable) & the complete proposal form shall be sent to the proposer.
On his / her registered e-mail ID or mobile number in the form of an e-mail or a message with a link as the case may be.
The communication with the buyer needs to clearly highlight the Sum Assured, the premium amount payable.
Policy term and the premium payment term of the proposal being solicit while seeking the proposer’s consent for the same.
The proposer if wishes to consent to the product offer
The benefit illustration and the completed proposal form, may do so by affixing a digital signature.
Clicking the confirmation link or by validating the OTP shared.
The Insurer shall not insist on payment of money towards proposal deposit till the receipt of the consent of the proposer.
Filling up the proposal form is only a part of the life insurance buying process.
Make sure you understand the policy features, the working of the plan, the death and maturity benefits before buying.
While the digital mode of buying and paying premium makes it simpler and easier.
Informed buying will go a long way in meeting your long term goals.
Call the insurer or speak to the insurance agent to dispel the doubts before dispensing with the wet-signature & opting for OTP based purchase of a life insurance policy.
Policy buyers can continue to buy term insurance policies
The comfort of their home for signing on any paper as the Insurance Regulatory and Development Authority of India has extend dispensation for physical signatures in life covers till 30 September 2021.
The facility was earlier slate to expire this month.
The insurance regulator issued a circular on Tuesday which stated.
“Life Insurers are allow to obtain the customer’s consent through electronic means, i.e.
Without requiring wet signature on the proposal form, for the business solicit.
Individual Agents and Insurance Intermediaries, under all products, till 30th September 2021.
The customer can validate the form without any physical signature & could be done via OTP or verification link.
This move has facilitate the customers’ experience & contributed towards the digitization of the system.
1. Life Insurers are allow to obtain the customer’s consent without requiring a signature on the hard copy of the proposal form:
- The completed proposal form shall be sent to the prospect on register e-mail ID or mobile number in the form of an e-mail or with a link as the case may be.
- The prospect, if wishes to consent to the proposal, may do so by clicking the confirmation link or by validating the OTP share.
- The Insurer shall maintain verifiable, legally valid evidence for the proposer’s consent received for the fully complete proposal form.
- Further, the insurer shall not accept any payment of money towards proposal deposit till the receipt of the consent of the proposer.
- The intermediary shall confirm that only the approve sales material has been use during the solicitation process.
- They shall also certify the authenticity of the e-mail ID and/or mobile number of the prospect.
2. The Insurers shall be responsible for:
- Providing to the insurance agents/intermediaries approve digital sales material and ensuring that only such material is use while soliciting the business;
- Authenticating the e-mail IDs/mobile numbers of the prospects by conducting de-duplication of such data and other such means;
- Ensuring the suitability of the product being purchase;
- Carrying out pre-issuance verification calls in respect of all such proposals.
The suitability assessment, benefit illustration (wherever applicable) & the complete proposal form will have to be sent to the buyers either.
Their register e-mail ID or phone number in the form of a message with a link.
The message/mail will have to specifically highlight the sum assure, premium amount payable.
Policy term & the premium payment term of the proposal being solicit while seeking the buyer’s consent for the policy proposal.
Once the buyer gives consent to the product offer
The benefit illustration & the complete proposal form needs to be affixer by a digital signature.
One can also validate it by the One-Time-password (OTP) process.
For dispensation of physical signatures in life insurance, an insurer has to authorize specific individual agents.
In such a situation, insurance agents will not have to sell non-single premium unit-linked insurance policies.
(Ulips) for annualized premium exceeding Rs 50,000 or single premium unit-linked insurance policies exceeding Rs1 lakh.
The insurer will also have to verify at least 3% of sales to ascertain compliance with these provisions.
The records of calls verification need to be preserve for a period of not less than 3 years.
Signature can be dispense with if insurers inform customers through text message about issue of policy document electronically.
Having in place mechanisms to verify receipt of the document and preserving all e-records.
Wherever policyholders demand a physical version of the policy document/copy of the proposal.
The exemption will be in force till March 31, 2021.