Moving Account Aggregator in Insurance from Onboarding to Meaningful Usage
India’s insurance sector has made progress in joining the Account Aggregator (AA) ecosystem, with all life insurers and insurers representing around 90% of the general insurance market onboarded. The next challenge is to translate participation into meaningful use for policyholders.
In a fireside conversation with financial educator and author Ms. Monika Halan at Sahamati’s SamvAAd 2026, Shri Ajay Seth, Chairman, Insurance Regulatory and Development Authority of India (IRDAI), outlined how consent-based financial data sharing could support insurance access, improve product suitability and create new opportunities across the insurance value chain.
From onboarding to consumer demand
Shri Seth emphasised that supply-side readiness alone will not drive adoption. The ecosystem must develop use cases that address real needs for individuals and micro and small enterprises, creating a pull factor for AA adoption.
Drawing a parallel with UPI, he highlighted how digital infrastructure gains traction when people see a clear benefit in using it. He called for collaboration between IRDAI, Sahamati and ecosystem participants to develop practical applications that make insurance more accessible and relevant.
Unlocking new use cases across insurance
Beyond lending against policy surrender value, Shri Seth outlined several opportunities for consent-based financial information sharing. These include premium financing for policyholders facing temporary income constraints, making health insurance premiums more affordable through financing, helping lenders compare insurance quotes, and using insurance history to assess borrower profiles.
Other opportunities include enabling surety bonds through better access to enterprise credit and insurance information, assessing the need for life protection based on an individual’s income, and supporting insurance-linked lending for smaller-ticket loans.
These use cases could help address gaps in access and affordability, while allowing financial institutions to make better-informed decisions. Their viability will depend on suitable pricing, reliable data and an economic model that works for all participants, particularly in low-value transactions.
Building complementary digital infrastructure
Shri Seth clarified that the Account Aggregator framework, Bima Sugam and the proposed Public Insurance Registry (PIR) are complementary rather than competing systems.
Bima Sugam is envisaged as a customer-facing platform for direct insurance purchases, while the PIR is intended to serve financial institutions through better access to structured insurance information. The AA framework can provide the consent-based data-sharing infrastructure that connects these systems with other financial information sources.
He also highlighted the need to improve data standardisation across insurers. While legacy data will take time to address, new data must follow common standards and protocols. The PIR can help build these foundations and create greater transparency around products, insurers and distributors, enabling consumers to make informed choices and encouraging demand for better information.
Expanding insurance access through digital infrastructure
Shri Seth noted that effective insurance cover may reach only around 15% of India’s population and economic enterprises, based on his estimate. He suggested that doubling this to 30% over the next five years could be possible
Digital infrastructure, he emphasised, can help reduce the cost of providing insurance services and extend access beyond larger cities. Intermediaries and assisted services will continue to matter, but digital channels can make insurance more accessible to people and enterprises that remain underserved.
The larger opportunity is to move the AA framework in insurance from participation to practical value. By building consumer-led use cases, improving data quality and connecting complementary digital public infrastructure, the ecosystem can support wider insurance access and better-informed decisions for policyholders.