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Redressal of Public Grievances Rules 1998

Redressal of Public Grievances Rules 1998

The main objective of these Rules is to provide for a speedy redressal of certain grievances specific to insurance sector. This is an alternative dispute resolution mechanism which is managed by insurance companies to solve the disputes arising within the industry. The Governing Body of the Insurance council shall consist of representatives of each of the insurance companies, which shall ordinarily be the Chairman or the Managing Director or one of the Directors of the insurance companies.

Ombudsman

The Governing body shall appoint one or more persons as Ombudsman for the purpose of resolving insurance disputes. Persons eligible to be appointed as Insurance Ombudsmen Only the following persons shall be eligible to be appointed as Insurance Ombudsmen:

(a) Persons who served in the capacity of Chairman or Managing Director in Public Sector Insurance Companies

(b) Persons who have served the Indian Administrative Service or the Indian Revenue Service

(c) Persons who are retired Judges of the Supreme Court or the High Courts.

An Ombudsman shall be appointed by the Governing body from a panel prepared by a Committee comprising of:

(a) Chairman, IRDA

(b) Two representatives of Insurance council including one each from Life Insurance business and from General Insurance respectively

(c) One representative of Central Government

Term of office and Remuneration of Ombudsmen

An Ombudsman shall serve for a term of three years and shall be eligible for reappointment. However, an Ombudsman shall not hold office after he or she attains the age of 65. The Ombudsman shall be paid a salary of `80,000 per month and any pension to which he is entitled from Central Government or Statement Government or any other organization or institution shall be deducted from his salary.

Insurance
[Post Image Courtesy of Vichaya Kaitying-Angsulee at FreeDigitalPhotos.net]

Powers of Ombudsmen

An Ombudsmen is empower to entertain the following disputes:

(a) A complaint as specified under Rule 13

(b) Partial or total repudiation of claims by an insurer

(c) Dispute with regard to the premium paid or payable in terms of the policy

(d) Dispute on the legal construction of policies with regard to claims

(e) Delay in settlement of claims

(f) Non-issuance of any insurance document to customers after receipt of premium

Procedure for making a complaint

Any person who has a grievance against the insurer may himself or through the legal heirs make a complaint in writing to the Ombudsman within whose jurisdiction the branch or office of the insurer complained against is located.

The Complaint shall be in writing duly signed by the complainant or through his legal heirs and shall state clearly the name and address of the complainant, the name of the branch or office of the insurer against which the complaint is made, the fact giving rise to the complaint, supported by the documents, if any, relied on by the complainant, the nature and extent of the loss caused to the complainant and the relief sought from the Ombudsman.

In order that a complaint is entertained before the Ombudsman, the following conditions must be satisfied:

(a) The complainant must have first exhausted the remedies available within the insurance company for settling the grievance and approach the Ombudsman only if either the insurance company rejects the grievance or complainant not satisfied with the reply or the insurer fails to respond within one month of submission of the grievance

(b) No complaint can be preferred before the Ombudsman after one year from the date of rejection or final letter from the insurance company on the representation made by the complainant

(c) If the complainant has not preferred alternative legal remedies and the proceedings are not pending before any Court or Consumer forum

Recommendations by the Ombudsman

After hearing both the parties and the submissions made, the Ombudsman can make his recommendations on the case. Copies of recommendations shall be sent to the complainant and the insurance company concerned. Such recommendation shall be made not later than one month from the date of receipt of the complaint. If the complainant accepts the recommendation, a copy of the acceptance is communicated to the insurance company concerned. The insurer shall comply with the terms of recommendation not later than 15 days of receipt of the recommendation.

Award

Where the complaint is not settled by agreement, the Ombudsman shall pass an Award which shall be in writing shall state the amount awarded to the complainant. The amount of compensation shall not grant an award exceeding `20 lakhs (including ex-gratia and other expenses).

All Awards shall be passed within 3 months of receipt of the complaint and issue a copy of the Award to both the insurer and complainant. The complainant shall furnish to the insurer within a period of one month of date of receipt of the award, a letter of acceptance that the award is in full and final settlement of the claim.

Thereafter, the insurer shall comply with the award within 15 days of receipt of the acceptance letter and shall intimate the compliance to the Ombudsman.

Insurance Law And Practice - ICSI

About Author Mohamed Abu 'l-Gharaniq

when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries.

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