Insurance companies can continue to accept Aadhaar as a valid KYC document.
In a circular, IRDAI has clarified that insurance companies can accept Aadhaar as KYC document to verify address and identity of proposers.
However, insurance companies cannot make Aadhaar mandatory for customers and do Aadhaar based authentication for eKYC.
IRDAI said, “The insurers are advised not to mandatorily seek Aadhaar and PAN/form 60 from the proposer/policyholder as part of KYC. However, insurers may accept Aadhaar card as one of the documents for establishing identity and/or address of the proposer for KYC purpose.”
Insurers can accept copy of physical Aadhaar, e-Aadhaar, masked Aadhaar and offline Aadhaar XML.
Also, insurers will have to ensure that the first 8 digits of the Aadhaar number are properly masked. Insurers can only store the last 4 digits of Aadhaar number on their system.