In a move that seems to put in check, the rather rapid mandating of Aadhaar across many essential and non-essential services, the Insurance Regulatory and Development Authority of India (IRDAI) has confirmed that for customers to purchase insurance, authentication by means of Aadhaar is not compulsory.
A recent circular by the IRDAI stated, “It is hereby clarified that for accessing the details of the client from UIDAI for identification and authentication shall be with the consent of the client on a voluntary basis”.
For the uninitiated, the Unique Identification Authority of India (UIDAI) had, in 2016, issued Aadhaar authentication regulations that elaborate on the procedures for e-KYC (Know Your Customer). The facility provided by the UIDAI allows biometric authentication – through fingerprint or iris scanning, or a one-time password (OTP) received on the client’s registered mobile number or e-mail address.
Here's a quick gist of the IRDAI's decision that will hence apply to all the categories of insurers including life, general and standalone health:
- The insurance regulator will continue to allow the UIDAI Aadhaar based e-KYC service, but it will remain a voluntary option and will be utilised only with the customer's consent.
- If the e-KYC service is utilised, any information downloaded from UIDAI will be considered as sufficient for the purposes of KYC verification.
- If the insurer finds any discrepancy in the name on the Aadhaar card, or the photograph is unclear, they could request additional information, while maintaining a record of any documents provided by the customer pursuant to such requests.
The decision seems to stem from the groundbreaking ruling by the Supreme Court, when a nine-judge bench led by former Chief Justice of India, JS Khehar unanimously declared Right to Privacy as part of Right to Life and Liberty assured by the Article 21 of the Indian constitution.
Source: Money Control
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