News eDaily09 Nov 2017

India:Insurers to link insurance policies to unique ID of each customer

09 Nov 2017

All general, life and standalone health insurers must link existing and new policies with immediate effect to the Aadhaar, the unique identification number given by the government to every resident.

The IRDAI announced the mandatory requirement in a directive issued yesterday.

The move is in line with the government’s amended Prevention of Money Laundering Act requiring all financial services entities in India, including banks and mutual funds, to submit clients’ Aadhaar numbers and PAN for Know Your Customer authentication. PAN stands for Permanent Account Number, which is issued to each taxpayer. Since 1 July, the government has made linking the PAN with the Aadhaar mandatory for filing income tax returns and obtaining a new PAN.

The central government on 1 June 2017 notified the Prevention of Money-laundering (Maintenance of Records) Second Amendment Rules, 2017, making Aaadhar and PAN mandatory in financial services including insurance.

"These rules have statutory force and, as such, life and general lnsurers (including standalone heatlh insurers) have to implement them without awaiting further instructions," said the IRDAI in its circular. For existing policies, Aadhaar can be ceded at the time of renewing the insurance cover.

 

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