Reassuring the insured: IRDA’s grievance redressal mechanisms

The interest of policyholders is on top of the Insurance Regulatory and Development Authority’s (IRDA) agenda. In fact, a media campaign has been launched in order to educate policyholders and publicise the regulating body’s grievance redressal mechanisms. Another initiative in this direction is the launch of the Integrated Grievance Management System (IGMS), a platform to help customers lodge and track their complaints online. Additionally, the regulator also has a grievance cell, besides several Insurance Ombudsman offices.

When it comes to general insurance, grievances usually pertain to the non-settlement or partial settlement of claims, pre-existing illnesses, delays in approving claims, the refusal to renew health insurance policies and loading of premium. In the case of life insurance, grievances pertain to the unilateral change of policy terms and conditions after issuing a policy, and the rejection of claims on grounds of suppression of material facts by the insured.

Irrespective of the nature of the grievance, in case of a disagreement, the first port of call has to be the insurance company. You can register your complaint through a branch office, or over a phone call, email, the website, etc. Alternatively, you can approach the company’s grievance redressal officer.

Insurers are required to acknowledge your complaint in writing within three working days of receipt. The grievance redressal norms also require the company to specify the period by when this issue is likely to be resolved. If a resolution is effected within three days, you will be intimated about the same. If not, the company will have two weeks to send a final letter of resolution. If the complaint is rejected, the company has to disclose the reasons for doing so and will also need to inform the policyholder about other redressal avenues available. Remember, before escalating the complaint, you need to inform the insurer of your frustration, failing which the insurer will treat the problem as solved.

If your problem has not been solved, the next step is to take your grievance to the regulator through the IGMS, the IRDA Grievance Redressal Cell or the Insurance Ombudsman offices. Most companies, barring a dozen, are now integrated on the IGMS platform. Remember, though, that this route can be adopted only if you do not receive a response within 15 days of bringing your grievance to the company’s notice. With the IGMS, you can route your complaint through the newly-launched website (www.igms.irda.gov.in). You need to first register on the portal to be able to lodge and subsequently track your complaint. A token number is provided by IRDA for follow-up.

Once lodged, complaints are escalated to senior executives of insurance companies (claims under Rs 20 lakh in personal accident and health, are directed to the Insurance Ombudsman.) The details of the complaint can be viewed online by the consumer, the insurance company and the IRDA. In this mode of redressal, no action is taken by the IRDA, and the insurance company concerned needs to deal with the grievance. The idea behind setting up the IGMS is to monitor complaints and analyse patterns. While the nature of the complaints varies, the most common complaints are those regarding non-settlement of claims or non-receipt of the policy document.

Unlike the Grievance Cell, the Ombudsman does have the power to pass orders. Cases of up to Rs 20 lakh fall under the ambit of the Ombudsman’s powers. The Ombudsman addresses issues related to rejection or delay in the settlement of claims, disputes on premiums and non-issuance of a document after collecting the premium. Complaints have to be filed with the Ombudsman office under whose jurisdiction your complaint falls. Recommendations can be made within a month of the receipt of the complaint, while a verdict has to be given within three months. If the need arises, the Ombudsman can also award compensation to the policyholder. The Ombudsman is appointed by the Insurance Council and is supposed to be independent. The order passed by the Ombudsman is binding on the insurance company. It is up to the insured whether to accept the award or to file a consumer complaint if he/she is dissatisfied with such an award. If the verdict is acceptable to the insured, he/she is required to intimate the Ombudsman of this within 15 days. The insured can also approach consumer forums or civil courts for relief if the insurer fails to comply with the Ombudsman’s order or they are not satisfied with it.

While consumer groups remain apprehensive about the steps being taken by the regulator to protect policyholders’ interests, these moves are definitely a step in the right direction.

In addition to the IGMS, the IRDA already has a grievance cell in place that would be your next stop, should the insurer act difficult. You can reach the cell by dialing 155255 or by sending an email to complaints@irda.gov.in. The cell does not pass orders, but complaints received are taken up with the insurers. This cell does not consider complaints sent in by third-parties like lawyers or agents, and hence, one shouldn’t rely on others to make the complaint