Certificates of Insurance coverage guidelines in India 2021: Replying to a query on whether or not the Authorities is contemplating offering e-insurance certificates as a substitute of issuing insurance coverage Bonds, Union Minister of State for Finance Anurag Thakur not too long ago knowledgeable Rajya Sabha that the insurer has to challenge each bodily and digital insurance coverage certificates to policyholders as per IRDAI guidelines. Nonetheless, because of the COVID-19 pandemic, insurers had been allowed to challenge digital coverage paperwork solely until March 31, 2021, as an interim measure.

From April 1 onwards, the insurance coverage firms should ship insurance coverage insurance policies in bodily kind to policyholders, relying on the consent of the policyholder.

“The Insurance coverage Regulatory and Growth Authority of India (IRDAI) has knowledgeable that regulation 4 of IRDAI (issuance of e-insurance insurance policies) Rules, 2016 stipulates that each insurer shall challenge digital Insurance coverage coverage based mostly on specified premium or sum insured. Nonetheless, these digital insurance policies are additionally required to be issued in bodily kind as properly, besides when these are issued by way of registered insurance coverage repositories,” mentioned Thakur.

“Lately, in view of the COVID-19 pandemic as a particular case, IRDAI has allowed insurers to challenge solely digital coverage paperwork and exempted them from the requirement of sending insurance coverage insurance policies in bodily kind until thirty first March 2021, topic to the consent of the policyholder. The exemption offered by IRDAI is an interim measure because of the COVID-19 pandemic,” he added.

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Within the context of Thakur’s assertion within the Rajya Sabha on the issuance of insurance coverage certificates to policyholders, right here’s a deep dive into the precise IRDAI guidelines on this regard.

What’s the certificates of insurance coverage?

A certificates of insurance coverage (COI) is issued by an insurance coverage firm and verifies the existence of an insurance coverage coverage. It is important that the shopper checks the coverage protection dates and the boundaries of the coverage. Certificates of insurance coverage comprise separate sections for several types of legal responsibility coverages.

What are the IRDAI guidelines for issuing insurance coverage certificates to the insured?

Neeraj Prakash, Managing Director, Shriram Common Insurance coverage, informed FE On-line, “Regulation No. 4 (iii) of the IRDAI (Issuance of e-Insurance coverage Insurance policies) Rules, 2016 supplies that every one insurance policies issued in digital kind by the Insurer on to the policyholder shall even be issued in bodily kind. In all such instances, copies of the proposal kind, and so forth shall even be despatched in bodily kind.”

Casparus Kromhout, MD & CEO, Shriram Life Insurance coverage, says the certificates of insurance coverage is required in group insurance coverage instances.

“Group insurance coverage is an insurance coverage coverage that’s taken by a pre-defined group of people who have come along with a standard function and a standard financial exercise. In these instances the insurance coverage contract is between the Insurance coverage Firm and the Group; and a grasp coverage is issued to the supervisor of the group and will likely be within the identify of the group. Thus particular person coverage paperwork should not issued for the group members; however in lieu of that IRDAI specifies that the Insurer ought to challenge insurance coverage certificates or Certificates of insurance coverage (CoI) to the group members in case of a non-employer-employee group coverage,” the Shriram Life Insurance coverage CEO informed FE On-line.

“These certificates comprise the advantages of the insurance coverage cowl offered together with the phrases and circumstances. The certificates are additionally required to comprise the process to file for a declare if wanted and the contact particulars of the insurer,” he added.

Can an insurance coverage certificates be issued on-line solely?

Certificates of Insurance coverage will be issued within the Bodily or an internet format. They should be offered to the Grasp Coverage Holder (the supervisor of the group) and are distributed by them to the group member, mentioned Casparus Kromhout.

Neeraj Prakash mentioned that principally Coverage/Certificates is issued on-line to facilitate the insured for any urgency, with the comfort of offering exhausting copy of the doc. Nonetheless, Digital Insurance coverage Insurance policies are issued with digital signature in accordance with relevant provisions prescribed by regulation. “Wherever policyholders demand the bodily model of the coverage doc, the identical is made accessible. And wherever it’s not doable to ship the coverage paperwork by way of digital means attributable to any purpose, there additionally insurers essentially ahead the bodily paperwork to the policyholders,” he mentioned.

Is it obligatory for firms to challenge bodily in addition to on-line insurance coverage certificates?

The bodily type of the digital Insurance coverage Coverage is a duplicate of the digital kind. Based on Prakash, the bodily model of the digital insurance coverage insurance policies needn’t be issued when digital insurance coverage insurance policies are issued by way of the platform of registered Insurance coverage Repositories. Equally, copies of the proposal kind and so forth are additionally despatched in digital kind to the insured along-with digital insurance coverage insurance policies. Digital insurance coverage coverage is issued by the Insurers both on to the policyholders or by way of the registered Insurance coverage Repositories.

Lately within the wake of Covid-19 pandemic, the Regulator granted the exemption to insurers from the requirement of (a) issuing coverage paperwork and (b) copy of the proposal in bodily kind in sure instances. Nonetheless, as per Rule 141 of Central Motor Automobile Guidelines 1989, a certificates of Insurance coverage is to be issued solely in Kind 51. It’s only in Motor Automobile Insurance coverage, other than the coverage, {that a} separate certificates of insurance coverage is required to be issued by insurers. This doc is at all times required to be carried within the automobile.