Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term

Protect Your family’s financial future with Kotak e-Term. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. Know more

Close

Get a Call

Enter your contact details below and we will get in touch with you at the earliest.

  • Select your Query

Thank you

Our representative will get in touch with you at the earliest.

All You Need to Know About KYC

“Know Your Customer”, commonly known as KYC, has enabled financial institutions to be on the safer side and build trust among its customer.

  • May 08, 2023
  • 1,346 Views

KYC has become a common practice largely followed by the insurance and financial sector. This involves eliminating suspicious people from becoming customers of the company. It is typically done to minimize the risk of malpractice.

Key takeaways

  • KYC is all about getting information about your customer through a process of documentation.
  • The process is useful in the identification of any kind of illegal activity by cross-checking the customer’s address and identity.
  • The process of KYC is easy, involving just 5 steps which can be done online as well.

The world has taken a different shape with the impact of digitization. It has made lives easier and simplified complex things. But with its various benefits, digitization has also effected negatively when it comes to a number of frauds. To restrict the activities leading to cyber crimes, “Know Your Customer” (KYC) was introduced. It is an initiative to mitigate the risk associated with customers availing of various services, especially related to banking and investment.

What is KYC?

As the name suggests, “Know Your Customer” is all about getting information about your customer through a process of documentation. It requires basic information about an individual as proof of identity and address. The required KYC documents are a PAN card, an Aadhaar card, etc. There are two types of KYC; one is Aadhaar-based KYC, and another is offline KYC or in-person verification.

KYC Requirements

KYC is important for better transparency and validity as it is the first screening to reduce the risk of fraudulent activities. After knowing about the KYC, you must be aware of when and where it is required. There are broadly two sectors mentioned below where KYC is currently mandatory:

KYC for Banks

KYC has now become mandatory for opening a bank account and making investments in recurring deposits, mutual funds, fixed deposits, etc. It becomes important for the bank to identify a legitimate customer so that it can easily predict and prevent fraud.

KYC for Investment

KYC is necessary to purchase investment/insurance policies to curb instances of black money. As per the guidelines of the Insurance Regulatory and Development Authority of India (IRDAI) and the Securities and Exchange Board of India (SEBI), the KYC process is followed by all life insurance and mutual fund investors.

Benefits of KYC

KYC has come into the light after registered frauds by clients or customers, especially in the banking and investment sector. Also, the institutions, as well as registered customers, feel safe with the transparent process of KYC. Here are some benefits of the same:

  • Establishes the identity of the customer.
  • Helps in assessing the risk of money laundering.
  • Protects financial institutions from sudden losses.
  • Safeguard stakeholders of the institution.
  • Ensures trust between individuals and individuals.
  • Restricts financial frauds occurring due to hidden identity.

KYC Process

Gone are the days of a long process of documentation. The KYC process is simple and does not require much time. In some cases, you need to fill out a KYC form to initiate the process. Here is a step-by-step process that is generally followed to get your KYC details:

Step 1: Submission of Documents

Applicant availing themselves of financial services is required to submit documents for verification. KYC verification involves identity and address proof, which can either be in electrical or physical form.

Step 2: Identity Verification

The authorized agency carries out the process of identity verification. For example, if you have submitted a driver’s license, the verification is done by the Department of Motor Vehicles.

Step 3: Residency Verification

Residency verification involves verification of resident status like current residential address, alternative residential address, etc.

Step 4: Verification of Financial Condition

Your status of assets and liabilities is verified using documents, contacting the issuer, and physical checks. This helps in mitigating the risk of misrepresentation.

Conclusion

KYC has made financial institutions capable of identifying fraud. It has not only helped in reducing the cases of financial fraud but has also offered various benefits to the customers who complete the process successfully. With initiatives like these, the economy gets a better platform to grow, and citizens get better and fair opportunities along with a transparent system.

If you are still not an authorized customer, then you must complete the process of KYC so that you can avail of the services of the institution.

Kotak e-Term

Download Brochure

Features

  • Life Cover till 85 years for Life & Life Secure Option
  • 3 Payout Options
  • Special Rates for Women
  • Option to exit the policy with premium refund at the age of 60*
  • Special Rates for Non-Tobacco Users
  • Free Medical Check Up every 5th year**

Ref. No. KLI/22-23/E-BB/2435

T&C

- A Consumer Education Initiative series by Kotak Life

Similar Articles

What Is Staggered Payment Option Under Term Insurance Policy?

Life Insurance Policy Closure

All about Your Rights and Duties While Buying Life Insurance Policy

Does Life Insurance Pay for Suicidal Death?

Is it Possible to Reduce Life Insurance Premium without Affecting Sum Assured?

Process of Filing A Claim For Life Insurance

Term Plan with Return of Premium (TROP)

What is Group Insurance?

Life Insurance Plans for Women

Why Online Term Insurance Plans Cheap?

“Life” Insurance or “Death” Insurance?

जीवन बीमा पर ऋण

All About Life Insurance and How It Works?

Difference Between Money Back and Endowment Policy

How Much Life Insurance Cover Do I Need?

When are Millennials required to take out a life insurance policy?

Types of Insurance You Must Invest in for Secure Future

Life Insurance with Money Back vs Without Money Back

Why Term Insurance for Women is Important?

Why One Must Buy Term Insurance before 25 Years

Health Insurance VS Life Insurance

Why Renewal of Term Insurance Plan is Important

Most Common Life Insurance Riders to Enhance Your Existing Policy

5 Things to Keep in Mind While Buying Life Insurance Policy

Sabse Pehle Life Insurance

Important Factors to Consider While Choosing the Right Term Period for Your Term Insurance Plan

Role of Life Insurance in Your Financial Portfolio

Is it Worth Buying Disability Rider on Term Insurance?

Take 100% Responsibility of Your Family with Term Life Insurance

Life Insurance for Overweight Applicants

How Often You Must Review Your Life Insurance Policy?

बीमा क्षेत्र में IRDAI की भूमिका

6 Things You May Not Know about Life Insurance

Can An Individual Buy Multiple Term Insurance Plans?

Various Term Insurance Premium Payment Options Available in India

First Job? Here’s Some Tips on How to Manage Finances

How Many Insurances Should I Have?

Life Insurance vs Mutual Funds

What is Underinsurance & The Dangers of Being Underinsured

How Does Life Insurance Work?

How to Find the Best Term Insurance Plan in Seven Steps

Important Life Insurance Terms You Must Know

Benefits of Term Insurance with Critical Illness Rider

What is Minimum Life Insurance Policy?

All You Need to Know About Life Insurance - Its Benefits, Features, and Types of Life Insurance

How to Choose a Life Insurance Policy

When Should You Review Term Life Insurance of Yours?

How Do Term Insurance Plans Differ for Smokers?

What is the Difference Between Insurance and Reinsurance?

Choosing a Life Insurance Beneficiary

8 Things to Consider Before You Buy Life Insurance

Why do I Need Life Insurance?

6 Different Types of Insurance Policies

5 Smart Steps to keep in mind while buying term policies

Are Deaths Due To Coronavirus Covered by Kotak E-Term Plan?

Why is Medical Test Important While Buying a Term Insurance?

How to Buy a Term Life Insurance Online

How to Calculate Human Life Value(HLV)?

Guide for Buying Online Term Insurance Plans for Senior Citizens

Types of Life Insurance Or One Investment, Many Options

Why Life Insurance Is Always a Smart Decision

What Is Insurance Rider and It’s Benefits?

How to Choose Life Insurance for All Ages?

Nominee in insurance - A Complete Guide on nomination in insurance

Can You Transfer Life Insurance Policies to Another Company in India?

Health Insurance VS Life Insurance

Difference Between Insurance and Assurance?

जीवन बीमा क्या है?

Details Required To Be Filled In A Life Insurance Form

क्या जीवन बीमा एक निवेश है?

भारत में सर्वश्रेष्ठ टर्म प्लान कैसे चुनें?

Biggest Life Insurance Myths

Importance of Checking Claim Settlement Ratio before Buying Life Insurance

Insurance Vs Investment - A Guide to Your Financial Goals

How to Choose the Right Life Insurance Policy for Your Age?

1 CR Term Insurance Plan: How to Pick the Best 1 CR Term Plan

Is Voluntary Life Insurance the Same as Basic Life Insurance?

What Should One Expect During the Medical Evaluation for Life Insurance?

Term Life Insurance vs Accidental Death Insurance

NRI Premium Payment Options

Key Things to Review in Your Life Insurance Policy Document

How to Make Death Claims on Life Insurance?

Is Life Insurance For Millennials Really Needed?

What is Life Insurance?

Think About Life Insurance Sooner than Later

Role of IRDAI in the Insurance Sector

Staying Insured While Investing

Beware of Phishing & Fraud Insurance Calls

Is Life Insurance an Investment?

Different Kind of Deaths that are Not Covered in a Term Insurance Plan

What Happens If I Stop Paying My Life Insurance Premium?

5 Reasons Why a Women Should Buy a Life Insurance

What are robo-advisors in insurance?

Why do most Indians choose the wrong way to buy life insurance?

What Is Investment Insurance?

What Is Surrender Value (Cash Surrender Value) in Insurance and how is it calculated?

5 Reasons Why You Need Life Insurance in College

What Is a Whole Life Insurance Plan?

Voluntary Life Insurance Policy Vs Group Life Insurance

Life Insurance for Overweight Applicants

Life Insurance and Retirement Planning

All about IRDAI

Loan Against Life Insurance Policy

Life Insurance for Millennials

5 Benefits of Gifting Life Insurance Cover to Your Spouse

Do Life Insurance Premiums Increase Every Year?

All About Backdating in Life Insurance

Savings cum Protection Plans Secures Your Family from Unforeseen Events

वरिष्ठ नागरिकों के लिए ऑनलाइन टर्म इंश्योरेंस प्लान खरीदने के लिए गाइड

Life Insurance and Millennials

Digital Life Certificate for Pensioners Seeking Pension

What is a Single Premium Term Plan and its Tax Benefit?

Important Terminologies of Life Insurance

How To Choose The Right Life Insurance

Comparing low premium term insurance Is Not the Only Factor While Buying Life Insurance

Is It Time to Review Life Insurance Policy of Yours?

Choosing Between Short-Term & Long-Term Insurance Plans

Do Your Financial Planning with Life Insurance!

What happens to joint life insurance after divorce?

What Should One Consider Buying: Term Insurance or Traditional Life Insurance

What Is Social Impact Investing and How Does It Benefit Society?

Best Insurance Plans in India

Does Family History Affects your Term Life Insurance Rates?

How to Select a Perfect Life Insurance Policy in India to Protect Your Future?

Kotak Life Claim Settlement Ratio

What is Insurance Coverage? Overview, Types, and Examples

Top 5 Common Life Insurance Myths and Facts

Is it Possible to Make Changes in a Term Plan’s Specification Post Purchase?

Term Insurance for Home Loan: How Term Plan Helps in Paying Off Home Loan?

How to Buy a Life Insurance Plan?

5 Common Life Insurance FAQs and Answers

What Is The Life Insurance Penetration In India And How Does It Compare Globally?

How to Customize Your Life Insurance Policy with Riders

Benefits of Buying Term Insurance Plan for Senior Citizens in India

Life Insurance Nominees: 5 Must-Know Facts for Beneficiaries

Why Buying a Term Insurance is Important for all Parents

Reasons Why Term Insurance Claims Get Rejected

Insurance Changes You Need to Make Post Marriage

Term Insurance Tips for NRIs in India

Choose the Nominee of a Term Life Insurance Plan Wisely

Why Do Life Insurance Agents Avoid Selling Term Plans?

Who Is A Nominee In A Life Insurance Plan?

Does Life Insurance Policy Cover Covid Death?

What is Human Life value and a Human Life Value Calculator?

Can a Term Plan be the Substitute for a Retirement Plan?

9 Most Important Things You Must Learn About Paying Life Insurance Premium

Is It Advisable To Have Multiple Life Insurance Policies?

Terms and Conditions of Term Insurance Plans

How to Use Different Types of Life Insurance for Retirement Planning?

Customer Awareness on Information Security

Why You Should Never Cancel Life Insurance Policy

7 Superficial Reasons People Avoid Buying Insurance Online

All about Life Insurance Calculators

In India, should NRIs purchase life insurance?

Compare Different Life Insurance Products Offered By Kotak Life

Term Insurance Claim Process

FAQs on Life Insurance

What is the Difference Between Limited and Regular Pay Insurance Plan?

Important Features of a Term Insurance Plan

Does Life Insurance Cover Terminal Illness?

How do life insurance payouts work?

Types of Life Insurance Policies in India

How Much Life Insurance Do You Need?

How Much Life Insurance Costs and How Much Insurance Cover You Need?

Should You Buy Life Insurance After Getting Married?

भारत में जीवन बीमा पॉलिसियों के प्रकार

5 Ways to ensure faster settlement of claims

5 Easy Steps to Buying A Policy

What is the Current Trend in Term Insurance?

How to Revive the Lapsed Life Insurance Policy?

Guidelines for Linking Aadhar and PAN to Insurance Policies

5 Advantages of Life Insurance Going Digital

What Is the Procedure to choose a nomination in life insurance policy?

क्रिटिकल इलनेस राइडर के साथ टर्म इंश्योरेंस के लाभ

Why Your Family Should Know About Your Life Insurance Policy?

A Term Insurance Guide for Disabled People

What are the Benefits of Endowment Policy?

Why Should You Buy Term Insurance under the MWP Act (Married Women’s Property Act)?

Always keep your Nominee informed

Different Types of Insurance Policies in India

Adding A Child to Your Life Insurance Policy?

Different Types Of Life Insurance In India

Life Insurance Vs. Mutual Funds Investment

Term Insurance Vs Life insurance: Small Details, Big Differences

Can You Apply For A Life Insurance After Getting Heart Attack? Here is Everything You Need To Know

Can NRI Buy Life Insurance in India?

Life Insurance Beneficiary

What is Sum Assured in Endowment Policy?