Grievance Rederessal Procedure in Life Insurance

by Gopal Gidwani on April 7, 2012 · 2 comments

in Financial Planning,Insurance

Introduction
Sandeep Roy is an angry man! One month back, he had purchased a single premium payment life insurance plan for which he had provided a cheque of Rs 1.5 lakh to his insurance agent. But when he received the policy document, to his dismay, he found that company has issued him a regular premium payment plan. When he tried to contact his insurance agent, he was told that nothing could be done as policy document has already been issued.

Sandeep decided to cancel the policy as it was still within free look in period. Though the policy has been cancelled, he is still struggling for the past one and half months to get the refund for the cancelled policy. He has contacted the branch office by visiting it few times. He has got in touch with some senior officials of the company through email and phone for the same, but no body has been able to help him with his policy refund. Now he is thoroughly frustrated and wants to escalate the matter and wants some serious action to be taken against insurance company. But he is unsure about the correct channel on whom and how to approach.

People like Sandeep are not alone. You will meet numerous customers who are not satisfied and who will have their share of horror stories to tell about their dealings with insurance companies. In fact according to the IRDA Annual Report, in the first quarter of 2011-12 there were 73,419 complaints registered against insurance companies through the IGMS system of IRDA. Out of these 68,994 complaints have been attended to. During the year 2010-11 the Authority received 9656 complaints. Out of these 2588 were related to LIC and 7068 were related to private insurers. A major chunk of these complaints were sales related (23.83%) and non-payment of claims (21.71%). Others complaints were related to reasons like non receipt of policy document, free look refund etc.

Seeking a grievance rederssal from insurance company is not a very difficult activity, if you are aware about the correct process to follow. In this blog, we will discuss about the various options available to policyholders for seeking rederssal for their grievances against insurance companies.

Grievance rederssal channels
Grievance rederssal process has to start with concerned insurance company and can be further escalated to IRDA and other authorities if the policyholder is not satisfied with the resolution provided by insurance company in a timely manner.

1. Insurance company
As per the IRDA (Protection of Policyholders’ Interests) Regulations, 2002 guidelines every insurance company has to set up an internal grievance redressal department to address complaints and grievances of policyholders in an effective and efficient manner.

In case of any grievance, a policyholder needs to first lodge their complaint with the concerned insurance company. This can be done in following manner.

    • Grievance cell of insurance company: The policyholder can lodge his complaint with grievance cell / customer complaints cell of insurance company through various channels – visiting a branch office, internet banking, by calling up customer care, by sending e-mail or postal letters to the address that is provided in the policy document or website of the insurance company.
    • Grievance Redressal Officer (GRO): If the policyholder is not satisfied with the resolution provided by grievance cell, then they can contact the grievance rederssal officer (GRO) of the company. Contact details of the grievance rederssal officer are available in the policy document or the insurance company website.

If you want to know about the Grievance Redressal Policy of any of the below listed companies then simply click the name of the respective insurance company and you will be taken to the Grievance Redressal Page of that company


  • Senior Grievance Redressal Officer / Grievance Committee: If the policyholder is still not satisfied with the resolution provided by the grievance redressal officer then most insurance companies as a last resort have a senior redressal officer or a grievance committee to look into the policyholder’s grievance. In case the policyholder is still not satisfied he can approach other channels available to him to resolve his grievance.

Important guidelines issued by IRDA to insurance companies for grievance rederssal process:
IRDA has issued the followed guidelines to insurance companies for grievance redressal to protect the interests of the policyholders.

  • The insurance company needs to acknowledge the policyholder’s complaint / grievance in writing within 3 working days of its receipt. The insurance company also needs to intimate the policyholder with a specific timeframe within which their grievance is likely to be resolved.
  • If the insurance company is able to resolve the grievance within 3 days, same needs to be intimated to the policyholder, or else it will have to send a final letter of resolution to policyholder within 2 weeks.
  • The insurance company needs to provide a resolution within 15 days of receipt of complaint. If the insurance company fails to resolve the grievance to policyholder’s satisfaction within 15 days, policyholder can escalate their complaint.
  • In case the insurance company rejects policyholder’s complaint, then it needs to disclose the reason of rejection, along with details of other rederssal channels available (Insurance Ombudsman, IRDA Grievance Call Centre etc.) to the policyholder.
  • In case policyholder wishes to appeal to other channels, he needs to first inform the insurance company about their dissatisfaction. Else the insurance company considers the complaint to be resolved.

2. IRDA: If the policyholder is not satisfied with any of the resolutions given by the insurance company then he can escalate his complaint to other channels. One of the available channels for seeking grievance redressal is the regulator itself, IRDA. The Consumer Affairs Department of the IRDA handles policyholder grievances. For lodging a complaint with the regulatory authority, the policyholder has 2 options: IGMS or the IRDA helpline. We will explore the 2 options in detail.

i) IGMS: IGMS stands for Integrated Grievances Management System. IGMS is an online portal which has been launched by IRDA with effect from 1st April 2011. With IGMS, policyholders can:
a) through IRDA lodge their complaints online with the respective insurance company.
b) track the status of their complaints
c) escalate their complaint to grievance cell of IRDA

Complaint can be lodged through IGMS, only once the policyholder has intimated the respective grievance cell of insurance company and have not received any response within 15 days or the policyholder is not satisfied with the resolution provided by the insurance company grievance department.

Process of filing complaint at IGMS
a) Policyholder needs to first register himself at www.igms.irda.gov.in, by providing personal details and contact information. User also needs to select an identification number such as PAN number, mobile number, land line number, Voter’s ID card number, ration card number, passport number. This identification number along with date of birth is used for login into IGMS.

b) Once the policyholder registers his complaint into IGMS, a complaint ID is generated, which can be used for tracking the status of the complaint. IGMS has a defined TAT (turn around time) for each type of grievance/complaint.

c) The complaints lodged into the IGMS system are forwarded through IRDA to the respective insurance company. IRDA tracks the status of resolution. Grievance resolution has to be provided by insurance company.

ii) IRDA Grievance Call Centre (IGCC): In case a policyholder is not satisfied with the resolution provided by the insurance company, then as an alternate channel he can approach IRDA through the IRDA Grievance Cell. Policyholder can lodge their complaint with grievance cell of IRDA by calling on IRDA helpline number ‘155255’ (toll free number) or sending e-mail at complaints@irda.gov.in.
a) Grievance cell plays a facilitative role in grievance rederssal by taking up complaints with the insurance companies.  Where required investigations and enquiries are carried out by IRDA.

b) Grievance cell takes those cases that are related to ‘delay or non-response’ from insurers pertaining to various policy matters and claims.

c) The status of the complaints can be tracked by policyholders through the IGCC.

d) It is important to note that either claimant or policyholder himself has to register the complaint with grievance cell, as it does not entertain complaints written on behalf of policyholders by advocates, agents or any other third parties.

3. Insurance Ombudsman: If policyholder is not satisfied with the resolution being provided by insurance company then as an alternate channel for seeking grievance redressal the policyholder can escalate their complaint to insurance ombudsman in their jurisdiction.

a) Insurance ombudsman operates within the territorial limits. In simple words, the policyholder needs to lodge their complaint with the respective insurance ombudsman under whose territorial jurisdiction the branch or office of the respective insurance company (against whom the complaint is made) is located.

b) Insurance ombudsman can perform the functions of conciliation and award making.

c) Following complaints can be taken by ombudsman: partial or total repudiation (rejection) of claims by insurance company; dispute related to premium paid or payable in terms of the policy; disputes related to legal construction of policy wordings in case such disputes relates to claims; delay in settlement of claims; and non issuance of policy  document  after collecting the premium.

d) Insurance ombudsman can undertake only those cases where value of insurance contracts does not exceed Rs 20 lakhs.

e) Ombudsman has to provide a resolution to policyholder or claimant within 3 months of receipt of complaint. Accordingly insurance company needs to honor the award passed by ombudsman and implement it, provided the resolution / award is acceptable to the aggrieved complainant.

As per the IRDA Annual Report for 2010-11, the Insurance Ombudsman received 21,065 complaints (life as well as non-life) in the year 2010-11. Out of these the Ombudsman disposed 17,239 complaints. More information on the working of the insurance ombudsman can be found on the IRDA website by clicking here. The contact details of all the insurance ombudsmen offices across India can be found on the IRDA Website and are also given at the bottom of this article.

4. Consumer Forums: As an alternate channel for grievance redressal the policyholder can approach a consumer forum under the Consumer Protection Act, 1986.
District Forums: As a first step the policyholder can approach the District Forum. The contact details of all the District Forums across India can be found on this link.
State Commissions: In case the customer is not happy with the resolution provided by the District Forum then he can approach the State Commission. There are 34 State Commissions across India. The contact details of all the State Commissions can be found on this link.
National Commission: In case the customer is not happy with the resolution provided by the State Commission, then he can approach the National Commission. The contact details of the National Commission can be found on this link.
If the customer is not happy with the resolution provided by the National Commission then he can finally approach the Supreme Court.

All details of the provisions of the Consumer Protection Act, 1986 like details of the forums and commissions, their composition, jurisdiction, powers, manner of lodging the complaint, appeal can be found by clicking this link

5. Consumer Courts or Civil Courts: In case a policyholder is not satisfied with the resolution being provided by the insurance company then as an alternate channel for grievance redressal he can approach the Courts.

Conclusion
By making available multiple channels to policyholders / claimants for grievance redressal the IRDA and the Government have ensured that the small policyholder is not denied justice against the mighty insurance companies. These multiple channels strive to provide justice to claimants in an efficient manner and at the earliest. To ensure that all grievances are resolved in the fastest possible manner the IRDA has specified a specific TAT (Turn Around Time) for each kind of grievance, within which a resolution has to be provided to the policyholder.

In fact IGMS and IRDA Helpline (IGCC) are great steps by IRDA towards providing a speedy resolution to policyholder. These mechanisms also help IRDA in tracking the kind of complaints that are registered against an insurance company. It also helps IRDA in monitoring grievance disposal by insurance companies!

We have discussed most possible steps that an aggrieved policyholder / claimant can take for grievance rederessal. Finally we hope seeking grievance redressal becomes easy for all policyholders through the above discussed grievance redressal mechanisms / processes / procedures / channels.

List of Insurance Ombudsmen

Office of the OmbudsmanNAME OF THE AOMBUDSMAN AND Contact DetailsAreas of Jurisdiction
AHMEDABAD Shri B.C. BoseGujarat, UT of Dadra & Nagar Haveli, Daman and Diu
2nd Flr., Ambica House,(O) 079-27546150, 27546139
Nr. C.U. Shah College,Fax:079-27546142
5, Navyug Colony,E-mail: insombahd@rediffmail.com
Ashram Road,
AHMEDABAD – 380 014
BHOPALShri R.P. DubeyMadhya Pradesh & Chhattisgarh
1st Floor, 117, Zone-II,(O) 0755-2769200, 2769202, 2769201
(Above D.M. Motors Pvt. Ltd.)Fax:0755-2769203
Maharana Pratap Nagar,E-mail: bimalokpalbhopal@airtelbroadband.in
BHOPAL – 462 011
BHUBANESWARShri M.N. PatnaikOrissa
62, Forest Park,(O) 0674-2535220, 2533798
BHUBANESWAR – 751 009Fax:0674-2531607
Email : ioobbsr@dataone.in
CHANDIGARHShri K.M. ChadhaPunjab, Haryana, Himachal Pradesh, Jammu & Kashmir, UT of Chandigarh
S.C.O. No. 101,102 & 103,(O) 0172-2706196, 2705861
2nd Floor, Batra Building,EPBX: 0172-2706468
Sector 17-D,Fax: 0172-2708274
CHANDIGARH – 160 017E-mail : ombchd@yahoo.co.in
CHENNAI Shri K. SridharTamil Nadu, UT–Pondicherry Town and Karaikal (which are part of UT of Pondicherry)
Fatima Akhtar Court,(O) 044-24333678,  24333668
4th Flr., 453(old 312 ),Fax: 044-24333664
Anna Salai, Teynampet,E-mail : insombud@md4.vsnl.net.in
CHENNAI -600 018
DELHI Shri R. BeriDelhi & Rajashthan
2/2 A, 1st Floor,(O) 011-23239611,23237539, 23237532
Universal Insurance Bldg.,Fax: 011-23230858
Asaf Ali Road,E-mail : iobdelraj@rediffmail.com
NEW DELHI – 110 002
 
GUWAHATIShri S.K. KarAssam, Meghalaya,Manipur, Mizoram,Arunachal Pradesh,Nagaland and Tripura
Aquarius,
Bhaskar Nagar,(O) 0361-2413525
R.G. Baruah Rd.,EPBX: 0361-2415430
GUWAHATI – 781 021Fax: 0361-2414051
E-mail : omb_ghy@sify.com
HYDERABADShri P.A. ChowdaryAndhra Pradesh,Karnataka and UT ofYanam – a part of theUT of Pondicherry
6-2-46, 1st Floor,(o) 040-23325325, 23312122, 65504123
Moin Court,Fax:040-23376599
Lane Opp.Saleem Function Palace,E-mail : hyd2_insombud@sancharnet.in
A. C. Guards,
Lakdi-Ka-pool,
HYDERABAD – 500 004.
KOCHISmt. P.N. SanthakumariKerala, UT of (a) Lakshadweep, (b) Mahe – a part of UT of Pondicherry
2nd Flr., CC 27/ 2603(O) 0484-2358734, 2359338, 2358759
Pulinat BuildingFax:0484-2359336
Opp. Cochin Shipyard,E-mail: ombudsmankochi@yahoo.co.in
M.G. Road,
ERNAKULAM – 682 015
KOLKATAShri K. RangabhashyamWest Bengal, Bihar, Jharkhand and UT of Andeman & Nicobar Islands, Sikkim
North British Bldg.(O) 033-22134869, 22134867, 22134866
29, N. S. Road, 3rd Flr.,Fax: 033-22134868
KOLKATA -700 001.E-mail : iombkol@vsnl.net
LUCKNOWShri K.S.K. KhareUttar Pradesh and Uttaranchal
Jeevan Bhawan, Phase 2,(O) 0522-2201188, 2231330, 2231331
6th Floor, Nawal Kishore Rd.,Fax:0522-2231310
Hazartganj,E-mail: ioblko@sancharnet.in
LUCKNOW – 226 001
 
MUMBAIShri R.K. VashishthaMaharashtra, Goa
3rd Flr., Jeevan Seva Annexe,(O) 022-26106928, 26106360
S.V. Road,EPBX: 022-6106889
Santa Cruz (W)Fax: 022-26106052
MUMBAI – 400 054Email: ombudsman@vsnl.net

Address and contact number of Governing Body of Insurance Council:

Secretary General
Governing Body of Insurance Council
Jeevan Seva Annexe
3rd Floor, S.V. Road,
Santacruz (W)
Mumbai – 400 054
Tel. No.   : 022 – 2610 6889, 26106245
Fax No.   : 022 – 26106949, 2610 6052
E-mail ID : inscoun@vsnl.net

For any comments on the above article please comment in the section below or email us at gopal_gidwani@yahoo.com

{ 2 comments… read them below or add one }

Swarup Saha June 15, 2012 at 9:12 am

e done a money back policy Table no 75 from LIC where I have to pay Rs.32000.00 yearly premium for a SA of % lacs with a tenure of 20 years.
Will be getting a money back of Rs.100000.00 as proposed this year..
Should I pay an advance premium for three years with the money or invest the money to some better investment options and pay my premium every year like before?My thought on paying advance premium is not to invest my own money in this bad endowment policy.

Reply

M. Jayant July 27, 2012 at 1:50 pm

This is really not a bad policy. in fact in spite of getting money at regular interval as per your need, u will receive a good bonus at the end of maturity. If u will pay three years advance premiums, then u will have a good discount on it, really check it.

Reply

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