IRDAI working with govt to create a simple platform for KYC

Mumbai: Insurance Regulatory and Development Authority of India (IRDAI) on Monday said though Aadhar is not a mandatory requirement for Know Your Customer (KYC) in the insurance sector, it is the most simple form of KYC document.

"Aadhar is not mandatory for the (insurance) sector but is the most simple one. On the government level they are creating a platform for all the KYC. "We are also working with the government for very simple KYC. But what can be simpler than a Aadhar," IRDAI Chairman T S Vijayan told reporters on the sidelines of CII's 19th Insurance Summit here.

Talking about Life Insurance Corporation's (LIC) shareholdings in listed companies, Vijayan said regulation for investment is 15 per cent, in exceptional circumstances sometimes exemptions are given to invest more.

"All the investment should be for the benefit of policy holders and investors and the companies should not be locking the money in and they should use the funds for the policy holders. "Regulation is 15 per cent, and when someone asks, in exceptional circumstances, we will give them some exemptions. Sometimes we give them liberty to invest more. At some point of time we advice them to bring it down to 15 per cent," he added.

Talking about distribution, the regulator urged the industry to strengthen distribution saying there is a need for merging technology with human touch.

"We have to understand that more than 20 lakh people get their income from distribution. Even if technology is adapted extensively insurance products distribution needs a human touch. "However, one has to understand that the agent requirement and growth depends on the company's growth strategy," he added.

Also present on the occasion, LIC Chairman V K  Sharma said only technology cannot prevent incidents of frauds.

Regarding digitisation and frauds, he said, "Only digitisation and technology cannot solve the problem of frauds. As technology advances frauds also go up. We have to develop digital and human matrix capturing individual behavioural data to prevent frauds."