Friday, October 24, 2008

Complaints against insurance companies

One of the objectives of the Insurance Regulatory and Development Authority (IRDA) inter alia, is to protect the interests of the policyholders. Accordingly, IRDA has notified the Insurance and Development Authority (Protection of Policyholders Interest) Regulations, 2002. These Regulations stipulate the duties and obligations of the insurers and policyholders in respect of an insurance contract, both at the point of sale and in the event of a claim, and setting up of in-house grievance redressal mechanism in the insurance companies. In pursuance of these regulations, the companies have set up in-house grievance redressal mechanisms. In addition to this, for grievances relating to settlement of claims, policyholders may also approach the Insurance Ombudsmen, IRDA Grievance Cell, Consumer Fora or the Courts.

With a view to ensure expeditious redressal of public grievances relating to the settlement of the claims, the Government has introduced a system of Ombudsman in the Insurance Sector with effect from 11th November, 1998. Insurance Ombdusmen are currently located in 12 cities. Each Ombudsman is empowered to redress customer grievances in respect of insurance contract on personal lines where the insured amount is less than Rs.20 lakhs. The insurer shall comply with the award given by the Ombudsman within 15 days of the receipt of the acceptance letter from the complainant and it shall intimate; the compliance to the Ombudsman. 

This information was given by Shri Pawan Kumar Bansal, Minister of State for Finance in reply to a question raised by Shri Raghuveer Singh Koshal in Lok Sabha today.

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