Dear Alisha-k,
If you believe that you are unable of taking note of those 12 words then you shouldn't be using electrum in the first place. Once you create an electrum wallet, I believe that the warning is more than enough to convince you that you have to watch out the seed phrase, because it's very important:
I felt once I have my userID and password I can assess my wallet from any device at any point in time not knowing the significance of this words
What is that userID and password you're referring to? There is no userID on electrum, only an optional password.
Could there be a recovery option for seed phrase or a seed generation alternative where I would be allowed to generate a new seed so as to access my lost account.
If there was such option, why would you, then, need to write down these 12 words? By saying "lost account" you probably mean "lost wallet"? There are no accounts such as bank accounts in this field. Only keys.
I believe every data online should have a means on backup and recovery. Would seed phrase act differently? Why create a wallet for users if it doesn't have a way of helping them recover lost or stolen wallet.
It does help them recover a lost wallet! It warns them that IF they write down these words, they can recover it whenever they need to. I hope that you do get that your electrum wallet isn't an “online data”. Those randomly generated words aren't stored anywhere online, you're responsible for your own funds.
In a case where someone misplaces his seed phrase and still has his wallet accessible could there be a way of regenerating a new seed phrase for such wallet to avoid loosing the funds in the future.
There is. If you open your wallet file (which is located on
C:\Users\<username>\AppData\Roaming\Electrum\wallets) that was generated and
not imported, you can find it on
keystore.
Here's an example:
"keystore": {
"derivation": "m/0'",
"pw_hash_version": 1,
"root_fingerprint": "140583d8",
"seed": "boost cute hover true ski reduce wide learn cotton bonus leg silk",
"type": "bip32",
"xprv": "zprvAYiD635NMn523mtqTBLAgfTfiTgpdoZsdCJkFn37LnBrmZZfvGMFDZTy5yXLFiU3f19SABEhsB5EV319GJJGq3PS8XaJzKNJUMQmXRMbDTZ",
"xpub": "zpub6mhZVYcGC9dKGFyJZCsB3oQQGVXK3GHizREM4ASiu7iqeMtpTofVmMnSwHVyjNEQ8i8XXhNssMitSTQApMxozZhwd37ZPtLBhc3jdhtUFAe"
},
As for this:
In all wouldn't it be more beneficial to store your coin with an exchange wallet where you wouldn't need to generate any form of seed phrase since all that is required is an email address and password.
I'll quote you why Bitcoin was created:
A purely peer-to-peer version of electronic cash would allow online
payments to be sent directly from one party to another without going through a
financial institution.