IRDAI Reg Section 15 : Privacy and Confidentiality
Act
Summary
Section 15 of the IRDAI Regulations, 2024, addresses privacy and confidentiality in the context of insurance policies. It mandates insurers and distribution channels to protect policyholder information, ensuring compliance with data protection laws. The section prohibits sharing policyholder data without explicit consent, except with statutory authorities, for underwriting or claims, or as authorized by the Authority. Additionally, insurers cannot include default clauses in proposal forms that allow unauthorized data sharing.
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Explanation using Example
Example 1: Unauthorized Sharing of Policyholder Information
Introduction: John, a policyholder, recently purchased a health insurance policy from XYZ Insurance. During the application process, he provided personal information, including his medical history and contact details.
Application: According to Section 15(2) of the IRDAI Regulations, 2024, the information collected from John during the solicitation of his insurance policy cannot be shared with any third party without his explicit consent, except under specific circumstances such as statutory requirements or for underwriting purposes.
Outcome: If XYZ Insurance shares John's information with a marketing company without his consent, they would be in violation of Section 15(2). This could lead to legal consequences, including potential fines or sanctions imposed by the regulatory authority. John could also file a complaint with the IRDAI, seeking redress for the breach of his privacy.
Conclusion: Compliance with Section 15 ensures that policyholders' information is protected, maintaining trust in the insurance industry. Non-compliance can result in reputational damage and legal penalties for the insurer.
Example 2: Clause in Proposal Form Allowing Data Sharing
Introduction: Sarah is reviewing a proposal form for a life insurance policy from ABC Insurance. She notices a clause stating that by signing the form, she consents to her information being shared with third parties.
Application: Section 15(3) of the IRDAI Regulations,...
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