The Insurance Regulatory and Development Authority of India (IRDAI) has directed insurance companies to use a video-based authentication process (VBIP) to enhance the ease of the know your customer (KYC) process.
VBIP is a method of customer identification by a representative of the insurer by undertaking seamless, secure, real-time, consent-based audio-visual interaction with the customer to obtain identification information including the documents required for customer due to diligence purpose and to ascertain the veracity of the information furnished by the customer, according to IRDAI statement.
"Such a process will be treated like a face-to-face process," IRDAI said.
Under this process, the authorised person of the insurer performing the VBIP for KYC will record video as well as capture live photographs of the customer present for identification and obtain the identification information."The authorised person of the insurer will have to ensure that the video is
clear and the customer in the video is easily recognisable and is not covering their face in any manner. Live location of the customer will also be captured to ensure that customer is physically present in India," IRDAI added.The authorised person will also ensure that photograph of the
customer in the Aadhaar matches with the customer undertaking the VBIP
and the identification details in Aadhaar shall match with the details
provided by the customer, as per IRDAI.In case of offline verification of Aadhaar using an XML file or Aadhaar
Secure QR Code, if voluntarily submitted by the customer, it will be ensured
that the generation of an XML file or QR code is not older than 3 days from
the date of carrying out VBIP.All accounts opened through VBIP will be made operational only after
being subject to concurrent audit/underwriting/verification, to ensure
the integrity of the process.
According to experts, this facility will enable the customers to invest in protection products without having to compromise on their personal safety.
“Customers will now be able to do their KYC while being at their home and without having to meet up with anyone. This process will require least amount of paperwork. This service will surely turn out to be most beneficial in times like these when all the authorities are advising maximum social distancing," said Santosh Agarwal, CBO-Life Insurance, Policybazaar.Most importantly, if the average cost of KYC of the customer costs Rs 200, in case of a video-based process, the cost will come down to only 10 percent of the entire cost, according to Agarwal.