Insurance Ombudsman Achieves Zero Pendency

Insurance claims immediately conjure up an image of running from pillar to post and the huge time delay involved in obtaining the claim. This makes the whole process strenuous. But the office of the Insurance Ombudsman in Chennai has instilled the hope that any such dispute would be settled within a prescribed timeframe for the past two years it has maintained zero pendency.

The Chennai Insurance Ombudsman, which caters to redressing the grievances of insurance policy holders in Tamil Nadu, Puducherry and Karaikal had received as many as 1,170 complaints during 2015-16 out of which 656 pertained to life insurance and 614 to non-life insurance.

As many as 111 awards were passed under life insurance policies and 192 in general insurance policies, accounting for a total disbursal of Rs 1.89 Crore to the complainants.

Even in 2014-15, over 900 such cases were dealt with ensuring that no backlog remained. 

Insurance Ombudsman Virander Kumar attributes this success to the process of reaching out to insurers instead of it being the other way around. 

He says, “Out of the 362 sessions of grievance resolution held in 2015-16, over 40 of them were held at Salem, Coimbatore and Thanjavur in a bid to reach out to the insurers there. Moreover, having established a zero pendency structure, it has been possible to settle cases within 90 days with our staff getting into action the moment necessary documents are obtained from the complainant.”

The insurance ombudsman scheme was created by the Centre for individual policyholders to have their complaints settled out of the courts free of cost and in an effective and impartial manner. 

However, in life insurance, a majority of complaints pertain to private insurance companies resorting to selling policies by misrepresenting the facts followed by rejection of death claims.

In fact, the Chennai ombudsman was vigilant in pinning a broker who had got insurers to obtain four or five policies through false promises. 

Similarly, in general insurance, a majority of complaints pertain to health insurance, followed by motor claims. 

Being a quasi-judicial agency, the forum acts through a process of mediation. On most occasions, the cases are resolved by interacting with the companies. 

But in several cases both the complainant and company are called for personal deposition and submission of supporting documents. 

During 2015-16, on the life side, 72.79 per cent complaints were decided in favour of the complainants and 27.03 per cent in favour of insurers.

Similarly, on the non-life side, 63.54 per cent complaints were decided in favour of complainants and 36.46 per cent in favour of insurers clearly establishing that the institution of ombudsman is living up to the purpose for which it was created. 

However, with the ombudsman bestowed with power of dealing with cases involving claims within Rs 20 lakh, the team here feels that it is high time the Redress of Public Grievances Rules, 1998, created 20 years ago, is reviewed to suit the present day needs.