Insurance Claims

HOW TO LODGE AND PURSUE GENERAL INSURANCE CLAIMS Insurance other than ‘Life Insurance’ falls under the category of General Insurance. Non-life insurance companies have products that cover property against Fire and allied perils, flood storm and inundation, earthquake and so on. There are products that cover property or person against burglary, theft, policies covering machinery against breakdown, transit policy, vehicle insurance, health insurance etc. Here we will discuss general principals/precautions to lodge claim with the insurance company. These guidelines/precautions will be helpful in early disposal of the claim and shall also restrain the insurance company from repudiating the claim on the false grounds. These are: First of all, at the earliest stage the policy holder/claimant should inform the insurance company about the incident which may give rise to any claim against the insurance company. For this policy holder/claimant need not to send any documentary proof, but only a letter mentioning the brief facts of the incident/accident/theft/disease/ hospitalization should be sent to the insurer through registered post/by hand against proper receipt. A copy of the said letter alongwith postal receipt/proof of delivery should be retained. Secondly within time limits, as specified in the terms and conditions of the policy, the policy holder/claimant should submit his/her claim with the insurance company. Alongwith claim form all the documents e.g. bills/prescription/FIR/discharge summary/copy of previous policies and communication written to the insurer to report the incident should be attached. A copy of the claim form, attached documents and proof of submission of claim should be retained. Thirdly the policy holder/claimant should regularly pursue the matter with the insurance company through written communications, mentioning therein the policy no., claim submission date and claim no., the said letters should be sent through the registered post or by hand against proper receipt and copy of the said letter alongwith postal receipt/proof of delivery should be retained. If the claim is not settled within the reasonable time period or if the claim is repudiated, than the claimant have these remedies: 1. file a complaint with Consumer Dispute Redressal Forum or State Commission or National Commission, according to their pecuniary & territorial jurisdiction; 2. file a complaint with the Insurance Ombudsman; or 3. in case of delay/non-response only, policy holder may approach to the IRDA and may file a complaint before IRDA, for speedy disposal of the claim.

4. Can file a civil suit against the insurance company for breach of contract; 1. COMSUMER FORUM/COMMISSION: Policy holder/Consumer may file their complaint before the District Consumer Forum, State Commission or National Commission, depending upon their pecuniary & territorial jurisdiction. Matter in which dispute amount is upto Rs. 20 lacs is within the jurisdiction of District Consumer Forums, matters above Rs. 20 lacs to Rs. 1 Crore are within the preview of State Commission and beyond Rs. 1 Crore matter may be filed directly before the National Commission. The award passed by these forums is appealable upto Supreme Court. 2. INSURANCE OMBUDSMAN: Insurance Ombudsman has two types of functions to perform (1) conciliation, (2) Award making. The insurance Ombudsman is empowered to receive and consider complaints in respect of personal lines of insurance from any person who has any grievance against an insurer. The complaint may relate to any grievance against the insurer i.e. (a) any partial or total repudiation of claims by the insurance companies, (b) dispute with regard to premium paid or payable in terms of the policy, (c) dispute on the legal construction of the policy wordings in case such dispute relates to claims; (d) delay in settlement of claims and (e) non-issuance of any insurance document to customers after receipt of premium. Ombudsman's powers are restricted to insurance contracts of value not exceeding Rs. 20 lacs. The insurance companies are bound to honour the awards passed by an Insurance Ombudsman, within three months. The complaint by an aggrieved person has to be in writing, and addressed to the insurance Ombudsman of the jurisdiction under which the office of the insurer falls. The complaint can also be lodged through the legal heirs of the insured. Before lodging a complaint: i) the complainant should have made a representation to the insurer named in the complaint and the insurer either should have rejected the complaint or the complainant have not received any reply within a period of one month after the concerned insurer has received his complaint or he is not satisfied with the reply of the insurer. ii) The complaint is not made later than one year after the insurer had replied. iii) The same complaint on the subject should not be pending with before any court, consumer forum or arbitrator. When a complaint is settled through the mediation of the Ombudsman, he shall make the recommendations which he thinks fair in the circumstances of the case. Such a recommendation shall be made not later than one month and copies of the same sent to complainant and the insurance company concerned. If the complainant accepts recommendations, he will send a communication in writing within 15 days of the date of receipt accepting the settlement. The ombudsman shall pass an award within a period of three months from the receipt of the complaint. The awards are binding upon the insurance companies. If the policy holder is not satisfied

with the award of the Ombudsman he can approach other venues like Consumer Forums and Courts of law for redressal of his grievances. 3. COMPLAINT BEFORE IRDA: Only cases of delay/non-response relating to policies and claims are taken up by the Cell with the insurers for speedy disposal only. After disposal of the claim if claim is repudiated the policy holder/claimant may approach the Consumer forum, Insurance Ombudsman or Civil Courts. 4. CIVIL COURT: the policy holder can file a civil suit against the insurance company for breach of contract. General insurance is a contract between the insurance company and policy holder. To file a civil suit you have to pay heavy court fees, so people generally avoid this remedy. Regards, Amit Jindal 9313089009