By Manju Dhake
As per the recent media reports, IRDA has provided approval for BIMA Sugam – Preparation for Insurance Exchanges. Bima Sugam will be a one-stop platform for all insurance needs, right from buying the policy to claim settlement and much more.
Under Bima Sugam, there will be E-BIMA or E-IA account for policyholders in a Demat format. It will facilitate more safety as there is no requirement for maintaining and safekeeping the physical document and creates ease for the policyholder at the time of renewal with no paperwork.
The policyholder and his family’s insurance policies can be kept by choosing one repository of their choice. It shall create ease of claim settlement for the nominee/beneficiaries due to the linkages of information stored in one place. The frauds too can be curtailed.
The overarching Insurance Platform shall allow the following insurance services:
- Buy insurance policy
- Claim Settlement
- Agent Portability
- Policy Portability
Bima Sugam will be a one-stop platform for all insurance needs such as Life, Health, and General insurance) such as Motor, Travel, etc.) categories. To bring together everyone under one roof, there need to be some changes in the existing structure.
In line with creating ease of doing business and making available Life and Health to all at a subsidised premium, there will be a lot of solutions around the same for the policyholders under “BIMA Sugam”
Who can have access to Bima Sugam?
It will be accessible by Insurers, Agents & Intermediaries and Customers
Who are the Stakeholders?
BIMA Sugam exchange will be monitored by the IRDA and shall have the following key stakeholders:
|Key Stakeholders||Stake||Fund Infusion|
|Life Insurance Council||30%||25 Cr.|
|General Insurance Council||30%||25 Cr.|
|Online PSBs||35%||30 Cr.|
|Brokers Association||5%||3 Cr.|
Who all will be linked?
Bima Sugam shall have linkages with UIDAI, NSDL, CDSL, etc as depicted below:
Who will benefit from Bima Sugam?
- Bima Sugam will pave way for the new entrant start-ups who are adopting a Sandbox approach in terms of unique offerings such as OPD covers, etc.
- This in my view will also open gates for Insurtech and Wealthtech players to leverage the opportunity of having a centralised database, and common API integration exposures across products from all categories. Especially those who are providing enterprise solutions to B2B, B2B2C, Health sector, etc. For example, it is said that the health insurance sector is a Rs 60,000 crore market and it is expected to grow at 30% from the last 5-year trend of 19% so far.
- Agent portability will surely help genuine customers who are facing difficulties with existing agents in terms of getting services. This may also be due to a shift in the location of the policyholder or agent itself. This also will elevate the after-sales services stronger wherever the agent is involved by creating a good customer experience.
- Existing Insurance Repository will get a boost in terms of all Insurance companies subscribing to it as Approved Person
- The existing fintech players who have transactional platforms may be impacted by Bima Sugam. Though the full announcement or circular is expected to come soon from the regulator.
One can sense exciting times ahead for the insurance industry as a whole.
(The author is vice-president, Insurance at 1 Finance, a personal finance advisory firm. Views expressed above are those of the author)