IRDA has now made it possible for insurers to offer dematerialized policies similar to other dematerialized financial products. Insurer stands to gain by savings in processing while customer also benefits since it will be easier for the customers to buy and manage their multiple life insurance policies in a single demat account. Regulator had proposed that every insurance company would tie up with designated repositories - SDL Database Management, Central Insurance Repository and SHCIL Projects, Karvy and CAMS Repository Services. Right now, this facility is approved only for life insurance products. However IRDA is expected to give ahead to general insurance policies as well.

E repositories will allow insurers to set up straight-through processing experience to customers where policies can be bought online and issued into e accounts without any physical policy.

To manage the additional risks associated with this critical outsourcing, insurer would need to beef up their reconciliation, risk management and audit coverage so that e-insurance policies do not pose additional compliance, information & record management related risks. Repositories will need to register with IRDA and are required to have sufficient processes to comply with the following requirements.

1. Systems & processes to protect against unauthorised access, alteration, destruction, disclosure or dissemination of records and data;

2. Secured network protected against unauthorized entry or access;

3. standard transmission and encryption formats and non‐ repudiation safe guards for electronic communications of data amongst the insurance repository, insurers and policyholders

4. Physical & computer security access control

5. Procedures & facilities to protect records against loss or destruction

6. Back up facility for people, data, paper, systems & processes

7. Procedures for maintaining integrity & confidentiality of the information

8. Compliance requirements to protect policyholder interests. Insurer and Repository will need to review their operations periodically. Riskpro provides consulting & audit services to review operations of the insurance repositories as well as consulting for setting up the best practices to keep information available, maintain integrity and protect confidentiality. (Contributed by Shriram Gokte - shripad97@yahoo.co.in)