The government recently modified the Insurance Ombudsman Rules, 2017, providing insurance brokers under the authority of the Insurance Ombudsman. Additionally, a new provision has been made for policyholders to register their complaints online.
Expansion of Complaints Scope
Previously, only disputes were considered. However, the updated rules will now include any deficiencies in service provided by insurers, agents, brokers, and other intermediaries. This change drastically amplifies the range of issues that can be raised, facilitating a more comprehensive approach to policyholder complaints.
Introduction of ICT Enabled Complaint Redressal
Another prominent feature of the amendments is the facilitation of electronic complaint registration. This innovative approach includes a complaint management system, where policyholders can monitor the status of their grievances online. Moreover, video-conferencing options for hearings have also been introduced. This digitisation aims to expedite the process and make it more cost-efficient.
Empowering the Ombudsman
Numerous amendments have been made to ensure the independence and integrity of the ombudsman selection process. Safeguards have also been established to preserve the impartiality of those appointed as ombudsmen. Notably, the selection committee will now consist of an individual who has a proven record of advocating consumer rights or contributing to consumer protection in the insurance sector.
About the Insurance Ombudsman
Established by the Central Government, the Insurance Ombudsman draws its powers from the Insurance Regulatory and Development Authority (IRDA) Act, 1999, and the Redressal of Public Grievances Rules, 1998. The roles, functions, term of office etc. are detailed under the Insurance Ombudsman Rules, 2017.
Ombudsman Selection and Qualification
An Ombudsman is chosen from individuals with experience in the insurance industry, civil service, administrative service, or judicial service. The selection committee comprises of IRDA’s Chairperson, who also chairs the committee, representatives from the Life Insurance Council and the General Insurance Council from the Executive Council of Insurers, and a representative of the Government of India not below the rank of a Joint Secretary.
Term of Office
The term of office for an Ombudsman is three years. Eligibility for reappointment exists, but no individual can hold office as an Ombudsman beyond the age of seventy.
Duties and Functions
Acting as a counsellor and mediator in disputes, the Ombudsman requires written consent from disputing parties. Furthermore, the IRDAI can refer any complaint or dispute related to insurance matters to the Insurance Ombudsman, enhancing the scope of grievance redressal.