Know Your Customer (KYC) is a standard practice to establish customer identity through documents and declarations. It is mandatory to run KYC verification and AML (Anti-Money Laundering) checks for the customers before policy issuance or claims processing.
Besides verification at the time of initial issuance, it is important to carry out Risk Assessment and due diligence (if required) at times when additional/ subsequent remittances are made.
Also, AML name screening is required to safeguard Sanctioned or Designated Individuals/Entities and ensure due diligence against PEP with the help of an AML screening Vendor.
The procedure has to be followed for all customers trying to purchase their policy or raise a claim post 1st Jan 2023, irrespective of the premium amount.
For Existing Customers, the timeline to complete KYC is 2 years.
For Group Policies, KYC is to be obtained for the Master Policyholder only. The KYC procedure is not required for each member of the group. However, the details of beneficiaries/groups need to be maintained by the Group Administrator.
KYC for all the claims is required, irrespective of the claim amount. However, in the case of GMC claims, the KYC of the master policyholder would suffice.