Now Receive and Cancel Life Insurance Policies Online: IRDAI allows Insurers to Send Policy Document on E-Mail


The life insurance rules allow the policyholder to cancel the policy within 15 days of receiving the policy document. This was, however, applicable on a physical copy of the policy document received by the insured. Now, the IRDAI has allowed insurers to issue the policy document on email and the insured can even get it cancelled within the free-look period.

In a recent circular, the IRDAI states that in the wake of the emerging situation of Covid19 Global Pandemic and taking into account the feedback received from the Life Insurers expressing difficulties in printing and dispatch of policy documents, the regulator has allowed an exemption from the requirement to issue policy document, copy of proposal form in physical form. This step to adopt digital means of doing business is also in the interests of policyholders and other stakeholders.

This exemption of sending electronic policies instead of the physical copy of the policy document will be valid for all policies issued during FY 2020-21.

The exemption is subject to the following rules:

a) Life Insurer confirming the date of receipt of electronic policy document by the policyholder through PIVC or other means and preserving the proof so that Free Look period may be calculated from that date.

b) 30 days Free Look period may be allowed for all such electronic policy documents.

c) Return of electronic policy document by mail by policyholder with clear intention of cancellation of policy will be valid for Free Look Cancellation.

d) Express consent of the policyholder to receive electronic policy bond is required. If a policyholder insists on hard copy, the same has to be issued without any charges.

e) Policy document is to be sent to the email id submitted by the proposer.

If the insured has not made any claim during the free look period, the insured shall be entitled to—

(a) A refund of the premium paid less any expenses incurred by the insurer on medical examination of the insured persons and the stamp duty charges or;

(b) where the risk has already commenced and the option of return of the policy is exercised by the policyholder, a deduction towards the proportionate risk premium for period on cover or;

(c)Where only a part of the insurance coverage has commenced, such proportionate premium commensurate with the insurance coverage during such period;

(d) In respect of unit linked policy, in addition to the above deductions, the insurer shall also be entitled to repurchase the unit at the price of the units as on the date of the return of the policy.


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