A promise of compensation for specific potential future losses in exchange for a periodic payment. Insurance is designed to protect the financial

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1 INSURANCE OMBUDSMAN

2 A promise of compensation for specific potential future losses in exchange for a periodic payment. Insurance is designed to protect the financial well-being of an individual, company or other entity in the case of unexpected loss. Insurance allows individuals, businesses and other entities to protect themselves against significant potential losses and financial hardship at a reasonably affordable rate. Insurance is still Sold and not Bought.

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4 An insurer, or insurance carrier, is a company selling the insurance. The insured, or policyholder, is the person or entity buying the insurance policy. A proposer is a person who proposes to enter into a contract of insurance with a life insurance company to insure himself or another life on whose life he has insurable interest A nominee is the person who receives the proceeds of a life insurance plan in case of death of the policy holder during the policy term.

5 There are many complaints that policyholders have from their insurance policies, most often they don t know where to and how to complain. In 9 out of 10 cases people usually let go the claim only because they do not want to get into court cases, which is a very expensive and may go on for years. Therefore, to help individuals get their grievances redressed in a quick and cost effective manner, finance ministry has set up the Insurance Ombudsman Office.

6 The institution of Insurance Ombudsman was created by Government of India Notification dated 11th November, Purpose is to quick disposal of the grievances of the insured. The institution helps to generate and sustain the faith and confidence amongst the consumers and insurers Only individuals can file their complaints in the ombudsman office and not corporate / companies.

7 The concept of Ombudsman began in Sweden where an independent executive was appointed by the government to look into the disputed matters of the citizens. Generally ombudsman is a person appointed by the organization to resolve disputes between someone outside the organization. Since the institution of Ombudsman is for protecting the policy holder s interest, it puts consumer s faith in the insurance companies and ensures that insurance companies are accountable in their transactions.

8 Consist of one representative from each of the insurance companies. Representatives shall be Chairman or Managing Director or any one of the Directors of the company Shall formulate its own procedure for conducting its business including the election of the Chairman. APPOINTMENT OF OMBUDSMAN The Ombudsman selected may be drawn from a wider circle including those who have experience in industry, civil service, administrative service, judicial service etc. An Ombudsman shall be appointed for a term of three years or till the incumbent attains the age of 65 years, whichever is earlier. Re-appointment is not permitted.

9 Mis-selling Signature Forgery Non-Cancellation of Policy Rejection of Health Claim Rejection of Death Claim

10 If the customer claim has been rejected which should not be rejected, then there is a dispute. IRDA IGMS does not have any adjudicating powers that is it cannot order insurance companies to pay claims. If customer have filed a claim and the company is not responding then he can write to IRDA IGMS and they will direct the insurance company to process it quickly. Once the insurer rejects the claim, it cannot order them to pay.

11 An Insurance Ombudsman has two types of functions to perform: Conciliation The insurance Ombudsman is empowered to receive and consider complaints from any person who has a grievance against an insurer. The complaint may relate to any of the following, Any partial or total rejection of claims by the insurance companies. Dispute with regard to premium paid or payable in terms of the policy. Dispute on the legal construction of the policy wordings in case such dispute relates to claims. Delay in settlement of claims. Non issuance of any insurance document to customers after receipt of premium. Award making An Ombudsman is empowered to provide awards in value not exceeding Rs. 20 lakhs. The insurance companies are required to honour the awards passed by an insurance Ombudsman within three months.

12 When a complaint is settled through the mediation or conciliation, the Ombudsman, shall make the recommendations which he thinks fair in the circumstances of the case. Such a recommendation shall be made not later than one month and copies of the same shall be sent to the complainant and the insurance company concerned. If the complainant accepts the recommendations, he will send a communication in writing within 15 days of the date of receipt accepting the settlement. The Ombudsman shall pass an award within a period of three months from the receipt of the complaint. The awards are binding upon the insurance companies. Once the Award is passed You have to accept the award in writing and the insurance company has to be informed of it within 30 days and The Insurance company has to comply with the award in 15 days after that. If you, as the policy holder are not satisfied with the amount awarded by the Ombudsman, you can approach other venues like Consumer Forums and Courts of law for redressal of your grievances.

13 If the insurance company rejects the claim or does not respond within one month of their receiving the claim; or if the complainant is not satisfied with the insurer s response, then he can get in touch with the Ombudsman. Under rule 13(3)a of the RPG rule. How to complain to the Ombudsman s office? The complaint has to be in writing. It has to be addressed to the insurance Ombudsman of the jurisdiction under which the office of the insurer falls. How much will it cost me? Nothing, as the services of the Ombudsman s office are free of charge and there is no need to hire an advocate.

14 As per current regulations, every insurance company has to inform the Ombudsman in whose jurisdiction the insurer s office falls for the purpose of any subsequent grievances redressal. The complaint can also be lodged through the legal heirs. The complaint to the Ombudsman no later than one year of receiving a reply from your insurance company. Also, the same complaint should not be pending before any court, consumer forum or arbitrator. What if the customer is not satisfied by the Ombudsman s ruling? While the decision of the Ombudsman is binding on the insurance provider, you still have the option to go to consumer court if his decision is not acceptable to you.

15 Supportive documents are not available within the time frame. Ombudsman is always inclined towards the customers. Errors in decline letters sent by the company to the complainant Call records are not there. In certain cases it is present but it is in encrypted form. So lot of time is wasted. Volume is huge

16 Policy documentation should be made simpler. Terms and conditions should be easy to understand. So that customer knows about the insurance policy and do not get trapped by fake promises. Improvements in Internal control system Better coordination and support from concerned team are required

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