Not happy with your insurer? Here's how to lodge a complaint

It is quite common these days to hear of complaints regarding delayed settlements of insurance claims as well as a less-than expected amount in settlement against the claimed amount. For example you may have lodged your health claim for Rs 2.20 lakhs but only received Rs. 1.80 lakhs in settlement. Your motor claim for your stolen car may have been repudiated by your insurer, leaving you high and dry. Or the nominee named by the insured may not have received the life insurance claim proceeds and may be in financial distress.

Don't hesitate to speak to your agent or broker, at the outset, to ventilate your problem. If that does not help, talk to your insurer through their help-line, which will be advertised on their website, and try to find a solution. If unsuccessful, you may then take recourse to the following actionable steps.

But please note, your complaint relating to claims must be referred for remedial action within one year of repudiation or reduced payment etc. as per policy condition or you will be unable to take it up for redressal later. So act fast.

What is the first step to take?

Your first point of formal contact should be your insurer. Send an official complaint immediately in writing to your insurer through their portal or online grievance channel whose address will be available on their web-site or in your policy.

(Please note, every life and general insurance insurer has a grievance redressal mechanism in place, for their aggrieved customers to use.)

A grievance is any communication that expresses dissatisfaction about an action or lack of action, about the standard of service / deficiency of service of an insurance company and / or any intermediary or seeks remedial action.

My personal experience in this regard has been satisfactory. My life insurance policy had matured in April, 2020 but I did not get my survival benefit on the due date, despite submitting all my documents in time. After following up with my agent, but to no avail, I sent a complaint on the insurer's grievance portal and my maturity amount was paid within a week.

What is the next step to take, if this is unsuccessful?

In case there is no response/satisfactory resolution from the insurer within 30 days, please escalate your complaint to another level.

If your insurer is a Public Sector organization like New India Assurance Company Limited or Life Insurance Corporation of India, send your complaint online to https://www.pgportal.gov.in/ or even by post/manually, to the Department of Financial Services, Ministry of Finance.

Complaints routed through the Department of Financial Services are accorded the highest priority by the public sector insurers concerned and resolved speedily within a maximum period of 60 days. (The maximum limit for disposal of Covid related grievances is 3 days.) They are also regularly monitored by the Ministry.

Alternatively, a complaint can be sent to the Insurance Regulator's portal on the Integrated Grievance Management System (IGMS) at https://www.policyholder.gov.in/Integrated_Grievance_Management.aspx It is an online consumer complaints registration system relating to all public and private sector, life and general insurers. Complaints are forwarded to the insurer concerned, by the Regulator, and monitored by the latter till they are concluded.

Is there any other avenue open to me for my complaint?

Yes, there is yet another higher level to which you can go for redressal.

You can also lodge your complaint with the Insurance Ombudsman. An Insurance Ombudsman has been set up by the Government for individual policyholders to have their complaints settled out of the court's system in a cost-effective, efficient and impartial way. Their primary function is one of conciliation and award making.

This pertains to personal lines of insurance upto a value of Rs. 30 lakhs and also to micro-entrepreneurs, sole proprietors and members covered in any group insurance plan with a grievance against the service provider.

(Insurance on personal lines is a policy taken or given in an individual capacity, e.g. life insurance, personal accident insurance, medical insurance, insurance of personal property of the individual such as motor vehicle, household articles, etc.) Thus, most health insurance policies and many life, home and motor claims fall within these limits

The Ombudsman can hear complaints relating to Insurance Companies operating in General Insurance business and Life Insurance business, in both Public and Private Sectors.

How is the complaint to be lodged?

The contact details of each Insurance Ombudsman Centre are available on the Regulator, Insurance Regulatory Authority of India (IRDAI's) website at https://www.policyholder.gov.in/addresses_of_ombudsmen.aspx

Depending on the Insurance Ombudsman under whose jurisdiction the insurer's branch or office is located or where the place of residence of the complainant is located, the complaint can be filed there. There are now 17 Ombudsmen in different locations.

A complaint can be filed by sending a letter (hard copy) to the Insurance Ombudsman or by fax or email. However, if you email your complaints, you are also required to send the hard copy of the letter, later.

Your letter must include all the necessary details such as policy number and complaint details, together with all relevant documents.

Complaints can be made only if you have first escalated the issue to your insurer and not heard back within a month or are dissatisfied with the outcome. A similar complaint should also not be pending in any other court, arbitrator or consumer forum.

What is the function of the Ombudsman?

The Ombudsman functions within a set geographical jurisdiction and can receive and entertain complaints on:

• any partial or total repudiation of claims

• any dispute in regard to premium paid or payable

• any dispute on the legal construction of the policies in so far as such disputes relate to claims

• delay in settlement of claims

• non-issue of any insurance documents

What does the Ombudsman do in case of disputes?

Usually, a brief single hearing takes place where the insurer's representative and you explain your perspectives and the Ombudsman arrives at a fair recommendation. If you accept this as a full and final settlement, the Ombudsman will inform the insurer which should comply with the terms in 15 days.

The Ombudsman thus initially attempts mediation and, if unsuccessful, issues an award that is binding on the insurer. Insurers must comply with the award within 30 days and delays are reported to their Boards.

If the Ombudsman deems it fit in the circumstances of the case, he may even award an ex-gratia payment.

Is there any time limit to approach the Ombudsman?

Yes. The time limit is within one year of the rejection by the insurer of the representation of the complainant or the Insurer's final reply to the representation.

Do I need to appoint a lawyer to represent me with the Ombudsman?

Not necessary, as formal court procedures are not involved.

What are the fees required in the Ombudsman's office?

No fees are required to file a complaint.

If I don't agree with the Ombudsman's judgement?

Then you can always go to other forums such as consumer forum or civil court. This however, should be your last resort.

Will going to the Ombudsman help?

Don't hesitate to utilize this option as it is easy, convenient and economical. This avenue is unfortunately underutilized since Policyholders are unaware about the role, location and complaint process of approaching the Ombudsman, despite all insurance policies carrying details. But now that you have the relevant information, from this column, make use of it.

You would be interested know that the Ombudsman, is usually drawn from a wider circle including those who have experience in industry, civil service, administrative service, judicial service etc. The general perception is that you will get a fair and impartial decision from the Ombudsman.

The only disadvantage is that this process may be somewhat time-consuming.

How do lodging complaints help?

Complaints are examined with due importance by the Regulator, IRDAI, not only for a resolution of the immediate issue, but also to bring in policy and systemic changes, if so required.

For example, when Covid claims were being denied and/delayed initially by insurers, the Regulator stepped in to say that such claims should be settled on priority. This situation also led to the Regulator mandating that Covid Specific standard policies should be sold by all

insurers.

So don't hesitate to ventilate your negative feedback, as your complaint may not only be resolved but may also lead to a systemic improvement in the insurance eco-system, benefitting everybody.

Is there any way to avoid complaints?

Prevention is always better than cure. So try to follow these simple tips to avoid disputes and delays later on.

• Always complete your own Proposal Form yourself with all the correct details, without any suppression or misrepresentation.

• Read the policy document carefully, particularly the conditions and exclusions. Be realistic about what is not covered.

• Select your insurer carefully. Your only criterion should not be to select the cheapest insurer. Verify the claims settlement ratio of the insurer, as well. (This refers to the percentage of insurance claims settled by an insurer compared to the total number of claims received.)The higher the ratio, the better the insurer's claim solving ability.

• Make use of the Free Look Period in health policies to read the terms, conditions and exclusions and to cancel the insurance, at a minimal cost, if they do not suit you.

• Please note the time-lines for lodging claims and submission of documents which are specified in each and every policy so that your claim is not rejected later

due to avoidable delays on your part.

The writer is former Manager, National Insurance Company Limited