e Insurance – Digital Insurance Revolution

LIC is set to revolutionize the insurance experience by shifting from traditional paper-based policies to fully digital policies in the coming days. This move is not only modern but also practical, as physical documents can be easily damaged, lost, or misplaced. Here’s an updated look at this digital transformation, including the latest data, statistics, and a comparison table to help you understand how e-insurance policies compare with traditional paper policies.

The Digital Transformation in Insurance

In recent years, the insurance industry in India has seen a significant shift toward digitization. According to recent data from IRDAI, as of January 2025, over 25% of new insurance policies are now issued in digital form a remarkable increase from just 2% in 2013 when India First Insurance began offering electronic policies. This rapid growth is driven by improved technology, government support, and changing consumer preferences.

Digital policies are stored electronically in a dedicated digital account, much like how mutual funds and shares are maintained in a Demat account. This system is managed through insurance repositories, which ensure that your policy details are secure and easily accessible.

Approved Digital Repositories

Currently, the IRDAI has approved five insurance repositories in India that handle digital insurance documents:

• NSDL Database Management
• Central Insurance Repository
• Karvy Insurance Repository
• CAMS Repository Services
• SHCIL Projects Ltd.

These repositories allow you to buy and store your policy in electronic form. With all your policies accessible in one digital account, managing your insurance becomes as simple as checking your bank or Demat account.

How Digital Policies Work

Once you opt for a digital policy, your insurance details are stored in an electronic repository instead of being printed on paper. While the digitization of policies is not yet compulsory, high-value policies will soon be mandated to go digital. Insurers may charge an annual fee ranging from Rs.500 to Rs.900 for maintaining the digital account, though many companies are beginning to absorb these costs to attract more customers.

Physical vs. Digital Policies

Benefits of E-Insurance

Digital policies offer several key advantages:

• Convenience: No more worrying about keeping track of multiple paper documents. Your e-policy is stored safely in one place, easily accessible from any device.
• Enhanced Security: Electronic storage reduces the risk of documents being damaged, lost, or stolen.
• Effortless Management: Online premium payments, instant policy updates, and digital access streamline the entire process, saving time and hassle.
• Environmental Impact: Digitization contributes to a greener environment by significantly reducing the need for paper.
• Future-Ready: With high-value policies moving to a mandatory digital format soon, early adoption means you’ll be ahead of the curve.

New Data and Trends

Recent industry trends indicate that digital adoption in the insurance sector is accelerating:

• Adoption Rate: As of 2025, more than 25% of new policies are issued digitally, compared to only 2% in 2013.
• Consumer Preference: Surveys show that over 60% of customers prefer digital documents because they are easier to store, search, and share.
• Cost Efficiency: With annual fees for maintaining digital accounts now ranging between Rs.500 to Rs.900, many insurers are absorbing these costs, making digital policies even more attractive.
• Regulatory Support: IRDAI continues to encourage digital initiatives. Their recent push for mandatory digitization for high-value policies is expected to boost the overall percentage of digital policies to nearly 40% by the end of 2025.

Future Outlook

The transition to digital policies is set to transform the way insurance is managed in India. As more insurers adopt digital platforms, consumers will benefit from enhanced transparency, better security, and easier access to their policy information. Additionally, digital platforms are paving the way for future innovations like blockchain-based policy management and AI-driven personalized insurance services.

In summary, digital insurance policies are not just a trend but a necessary evolution in the insurance industry. They offer a secure, convenient, and eco-friendly alternative to traditional paper policies. With IRDAI’s backing and growing consumer acceptance, the future of insurance in India is undoubtedly digital.

What do you think about e-insurance? Share your views in the comments below and join the conversation on how digital transformation is reshaping our financial future.