Life insurance companies have got conditional relief from the insurance industry regulator IRDAI on the issuance of physical policy documents for policies sold in 2020-21.

The regulator on Tuesday said that it has received feedback from life insurance companies that have expressed their difficulty in printing and dispatch of policy documents and has informed the IRDAI of their plan to adopt digital means of doing business through the issue of electronic policy documents in the interest of both policyholders as well as other stakeholders.

According to industry officials, under the current regulations all policies, including documents such as proposal forms, have to be issued in physical form on paper irrespective of whether the policy has been issued electronically.

However, IRDAI in its Issuance of e-Insurance Policies Regulations, 2016, has retained the power to grant exemption on issuance in physical form through clause 4(iii) of the regulation, which has now been triggered in the wake of the Covid-19 pandemic and associated challenges.

But keeping in mind the interest of the policyholders and to prevent mis-selling, the IRDAI has placed five conditions on the insurers.

The insurer has to confirm the date of receipt of the electronic policy document by the policyholder so that the free look in period of the policy can be calculated from that date.

Second, thirty days of free look in period to be allowed for all electronic policy documents. Third, return of electronic policy document by mail by the policyholder with a clear intention of cancellation, shall be valid in the free look in period.

Fourth, an express consent of the policyholder has to be collected through electronic policy bond. Fifth, the policy document shall be sent to the proposer’s valid email id.

Moreover, life insurance companies filed hard copies of quarterly investment returns with the IRDAI which can now be submitted through soft copy for returns upto March 31, 2021, the regulator said.

According to Motilal Oswal Research, the business volume of all life insurers have been hit in the lockdown with the weighted retail premium collected declining by 18.2 per cent for the industry.