Insurance regulator IRDAI has cautioned insurers against not complying with Ombudsman awards within the prescribed timeline.
Many insurers are neither complying with the awards nor filing appeals within 60 days of receipt of awards in line with provisions of a circular it had issued in April 2016, the Insurance Regulatory and Development Authority of India (IRDAI) said.
In a communication to CEO/CMDs of insurance companies, the regulator said the circular required all insurers to submit data pertaining to compliance of awards passed against them by insurance Ombudsman. It also cited the lnsurance Ombudsman Rules, 2017 that mandated insurers to comply with the awards passed by the Ombudsman within 30 days of receipt of award. A perusal of data received from all insurers for April-December 2018, has revealed that many insurers are neither complying with the awards nor filing appeals within 60 days of receipt of awards.
Reasons not given
Many insurers, according to the regulator, were also not mentioning reasons why the implementation of the award was pending, something they have to in the statement they submit.
“[A] Few insurers are not even submitting statements prescribed under above mentioned circular to the designated person,” IRDAI said.
When reasons for non-compliance were sought, a few insurers informed they had complied with the award post the stipulated timeline.
“Non-compliance of the awards within the timeline would severely undermine the grievance redressal framework and cause undue hardships to the policyholder,” the regulator said, adding failing to adhere to the timeline would be “viewed very seriously.”
