Insurance Companies Can Voluntarily Verify Aadhar Data

Aadhar biometrics and Unique Identification Authority of India (UIDAI) services would be voluntarily harnessed for potential insurance candidates.

The insurance companies in India have been consciously carrying out document verification process. This has been a mandatory step to meet Know-Your-Customer (KYC) requirements. So, these are frequently approaching certified verification companies like Fox I Vision and many likewise third parties. The leading ones are in a legal agreement with the government to access the UIDAI databases for finding discrepancies or detecting frauds in Aadhar because a little bit of ignorance can slam insurance companies with the claim for millions to billions of rupees.   

In April this year, a reputed newspaper published that it is purely the willingness of 29 insurance companies to authenticate KYC through this card’s details of the prospective insurance buyer.

Nine Financial Market Entities Can Do Voluntary Aadhar Check

The federal government has announced for the voluntary biometric authentication to be stretched to nine financial market entities in India. Simply put, this right of voluntary verification would be provided to none entities. A few of these would be BSE Ltd., National Securities Depository Ltd. and Central Depository Services (India) Ltd. The Finance Ministry has put its stamp of authorization to flag off the changes with a pair of notifications.

Advantages For Voluntary Verification

According to the Finance Secretary Ajay Bhushan Pandey, this big change can help the aforementioned entities to perform e-KYC in real time. This is likely to save thousands of rupees, as the verification cost would be way lesser.

Apart from that, the customer or the investor can also feel free from submitting physical papers or documents as per know-your -customer requirements. In other words, no physical visit, no struggling to submit papers or documents for the policy verification. This step is going to be a big relief for small retailers and investors. 

IRDA & SEBI Have Drafted Guidelines

IRDA or the Insurance Regulatory and Development Authority of India is responsible for setting up the guidelines for regulating the insurance industry. On the flip side, it is the securities and Exchange Board of India (SEBI) that regulates all securities firms in our nation.