In order to curb fraudulent insurance claims, which are being reportedly made over 500 per day, the Life Insurance Council is considering bringing a monitoring framework for its member. The apex industry body would prepare a centralized database of all policyholders, and will be functional from December this year.
Similar to banks get information from CIBIL (Credit Information Bureau of India Ltd) about the customers dealing with them, this system will help insurance companies retrieving details of customers and detect any fraud in disclosure and claims by policyholders.
On the sidelines of an event organised by Indian Chamber of Commerce, secretary general of Life Insurance Council, Mr. V Manickam said that the council is in the process of short listing a vendor who will collate the database aimed to provide a fraud monitoring framework.
In order to short list the vendor and to finalise the terms of reference, a meeting has been scheduled by the council.
All 24 life insurance companies operational in India, will sign agreements with the vendor chosen in the meeting, to share all details of the policyholders enabling the system to track policyholders details and prevent false insurance claims or duplication of claims.
Similarly, the Life Insurance Council is also considering to prepare another database to detect duplicate death claims made under the much hyped Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY). The CIBIL has been authorized to maintain database in the case. Since the scheme was launched in May this year, it has seen 44 death claims.
As per Mr. Manickam, the database for this particular scheme will go live on July 15.