There is no data on whether such grievances were upheld, partially upheld or denied.
A recently published IRDAI annual report shows that the life insurers and general insurers have redressed almost 100% grievances in FY 2013-14. The data shows that that the life insurance companies have redressed 99.69% grievances in FY 2013-14 while their non-life counterparts resolved 98.71% complaints during the same period.
Of the 3,74,620 grievances received by the life insurance companies in FY 2013-14, 3,74,664 grievances are said to be redressed including 1,224 outstanding complaints. A few life insurers like LIC and Max Life have redressed 100% grievances.
Aviva, Canara HSBC and Edelweiss Tokyo too redressed 100% complaints. These firms had received very few complaints.
Similarly, non-life insurers have redressed 63,736 grievances including 1,235 outstanding complaints. The general insurance industry had received 63,335 grievances last fiscal. Many private sector general insurers like Bharti Axa, Future Generali, Liberty Videocon, Magma HDI, Shriram, Tata AIG, Universal Sompo and Religare Health redressed 100% grievances. These firms had received very few complaints as compared to public sector insurers. Most grievances took over 30 days to get resolved.
Though these figures look satisfying, it’s difficult to ascertain if such grievances were upheld, partially upheld or denied.
A Mumbai based financial advisor is of the view that majority of such grievances are related to unfair business practice arising out of mis-selling and mis-interpretation of policy documents. He said, “Insurers have a pre-determined set of answers for most of the grievances. For example, in case of mis-interpretation of policy document, the insurer sends detailed product feature to policyholders. Majority of cases are being resolved in the mentioned format. Insurers don’t care if the policyholder is satisfied or not.” Last year, insurers had received 70% of grievances arising out of mis-selling and processing.
Pankaj Mathpal of Optima Money seconds the view and said that achieving 100% grievances redressal doesn’t imply the satisfaction of policyholders. “IRDAI should ask insurers to introduce one more section to find if the policyholders are satisfied with the redressal. Transparent data will help policyholders make informed choice.”
Gurpal S Dhingra, Director, Prudent Insurance Brokers Pvt. Ltd. Said, “Firstly, a policyholder needs to approach the grievance redressal cell of the insurance company. If the policyholder is not satisfied with the outcome, he/she can appeal to the insurance ombudsman. The insurance companies have to uphold the decision of ombudsman. Hence, to get a true picture of whether the grievances are being mostly redressed by the insurer or the Ombudsman, insurance companies should disclose the quantum of complaints settled subsequent to the ombudsman’s orders. Also, such a disclosure can help policyholders to know the track record of insurers in dealing with the claims of their policyholders."
Most
financial advisors said that there is a need for more disclosure to improve
transparency. They suggest information like feedback of policyholders,
procedure and manner in which grievances were redressed, outcome of grievance
redressal etc. should also be disclosed by insurance firms.
Recently, IRDAI has come out with the draft regulation in which it has proposed that the insurers should publish their grievance redressal procedure on their respective websites. Also, the regulator has proposed to set up a citizen’s charter. Both these steps may improve transparency, quality of services and communication between policyholders and insurers.