Insurance Ombudsman for speedy disposal of insurance disputes

Today we are celebrating Insurance Ombudsman Day (Bimalokpal Day) and as part of the celebration, interactions/meetings with all Life Insurance Companies and General Insurance including specialized Health Insurance Companies and with Insurance customers were organized.

The Government of India, in exercise of powers conferred by section 24 of the Insurance Regulatoy and Development Authority Act, 1999 (41 of 1999) framed “Insurance Ombudsman Rules,2017”, which came into force w.e.f. 25^th April, 2017 with the objective of providing a forum for resolving disputes and complaints from the aggrieved insured public or their legal heirs, nominee or assignee against Insurance Companies. These rules have replaced the earlier RPG Rules 1998.  These rules aim at resolving complaints relating to the disputes with Insurance Companies and their agents and intermediaries on personal lines of insurance, group insurance policies, policies issued to sole proprietorship and micro enterprises in a cost effective, efficient and impartial manner. These rules apply to all the Insurance Companies operating in General Insurance business and Life Insurance business, in Public and Private Sector.

The Institution of Insurance Ombudsman has been established and is functioning since 1999. The Office of Insurance Ombudsman, Mumbai was one of the first few offices started in the year 1999-2000. Since inception Mumbai office has been catering to the needs of the policyholders within its jurisdiction covering Maharashtra and Goa. However, looking at the very high numbers, diversity of complaints and increasing work load, it was decided to start a new Ombudsman centre at Pune which commenced its operation in December 2014. At present Mumbai office looks after the complaints of the customers residing in the Mumbai metropolitan area and the state of Goa while Pune office looks after the cases from Navi Mumbai, Thane and rest of Maharashtra.

The Ombudsman functions within a set geographical jurisdiction and can entertain disputes relating to:

1. Delay in settlement of claims.
2. Any partial or total repudiation of claims by an insurer.
3. Any dispute over premium paid or payable in terms of the policy.
4. Misrepresentation of policy terms and conditions at any time in the policy document or policy contract.
5. Any dispute on the legal construction of the policies in so far as such disputes relate to claims.
6. Policy servicing related grievances against insurers and their agents and intermediaries.
7. Issuance of life insurance policy, general insurance policy including health insurance policy which is not in conformity with the proposal form submitted by the proposer.
8. Non-issue of any insurance policy to the customers after receipt of premium in life insurance and general insurance including health insurance.
9. Any other matter resulting from the violation of provisions of the Insurance Act, 1938 or the regulations, circulars, guidelines or instructions issued by the IRDAI from time to time or the terms and conditions of the policy contract, in so far as they relate to issues mentioned at clauses (1) to (6).

Insurance Ombudsman gives an award for actual loss suffered or maximum up to Rs.30 lakhs. In Life Insurance, majority of complaints are due to mis-sale of polices followed by repudiation of Death claims. In General Insurance, majority of the complaints are from Health insurance claims followed by Motor claims. In the Health Insurance, the complaints are mainly for non-settlement or partial settlement of claims.

The forum acts through a process of mediation. On many occasions, the cases are resolved without personal appearance of the disputing parties by interacting with the Companies. However, in a large number of cases both the complainant and the Company are called for personal deposition and submission of supporting evidences.

The forum has taken certain initiatives like:

v  Fast track disposal of cases for Senior Citizens above age 70,

v  Priority handling of cases pertaining to critical illness and

v  Grouping of similar case coming from single source.

The number of complaints in the centre is the highest in the country primarily due to the increased awareness of the people, presence of many insurance companies in the area. The Mumbai centre has established itself as a pioneering centre not only in resolving highest number of disputes but also in providing valuable inputs to the industry and to the Insurance Regulator for improving the service standards through desired process and product improvement.

The forum has been continuously interacting with the Insurance Companies in order to improve the level of understanding as regards evolving good practices for the benefit of both the customers and the companies and to help speedy disposal of complaints. We have received good support and a significant impact of this has come in the shape of reduction in number of complaints and improvement in the quality of decisions. During the last four years the number of complaints handled by this forum are as under:

Almost equal number of complaints are received from Life Insurance and General Insurance side. After taking charge of the office on 4^th May, 2018 by the present Ombudsman, Mr.Milind Kharat, our office has cleared backlog of cases of earlier years. We aim to adhere to the stipulated time limit of 3 months for disposing a case from receipt of all the documents.

In order to get feedback and suggestions, meetings were held with Insurance Companies and also with policyholders in F.Y.2018-19. Today, as part of Ombudsman Day Celebration, we had meetings with Life, General and Health Insurance Companies. We also had meeting with policyholders where renowned consumer activist advocate Shirish Deshpande, Chairman, Mumbai Grahak Panchayat was the Chief Guest.

The team of Mumbai Ombudsman office is working with the commitment to ensure fair and prompt resolution of the Complaints. We have made significant headway in this regard. We seek support of the media in our efforts of providing relief in every deserving case, by reaching out and creating awareness in insuring public about insurance Ombudsman. We pledge to do our utmost to make this very important initiative of Govt. of India a delightful and meaningful experience to the aggrieved insurance customers.

Source: Press Release