Hyderabad, 16 September
Finance Minister P Chidambaram today said the Insurance Regulatory and Development Authority should look at fixing a time frame for making digitisation compulsory for both life and non-life insurance policies.
“Non-life should also become part of repository. At the moment I am told this is only on voluntary basis. I think it is right to begin on the voluntary basis but voluntary digitisation cannot be the rule for long,” he said while launching Insurance Regulatory and Development Authority’s (IRDA’s) insurance repository system here.
“We started with voluntary digitisation and dematerilisation in the depository system and we quickly moved to making it mandatory. “I urge the IRDA chairman to announce a timetable under which digitisation will become mandatory for all policies, beginning with life and then moving on to non-life,” Mr Chidambaram said in his inaugural address.
Talking about the importance of digitisation, he said people may tend to lose their identity while migrating from rural areas to urban areas and in some cases it becomes difficult to establish the identity.
The finance minister observed that digitisation of records would be a better choice in such cases. “There are many reasons why digitisation and repository is absolutely important,” he said. The IRDA said the insurance repository system set up by the regulator will be the first of its kind in the world.
The IRDA recently said five companies have been given the status of insurance repositories and provided with a licence that will be valid till July 31, 2014.
Mr Chidambaram also said he has asked insurance companies to open offices in flood-affected Uttarakhand to quicken claim settlements.
IRDA chairman TS Vijayan said as per 2012 figures, insurance penetration in India stood at a low 3.9 per cent.