Will seek feedback from policyholders on complaint resolution, lay emphasis on data analytics to ensure quick corrective action, says IRDAI chief Debashish Panda

The insurance watchdog plans to step up its vigil on resolving complaints to ensure greater satisfaction for policyholders.

The Insurance Regulatory and Development of Authority of India (IRDAI) plans to improve its grievance redressal framework using advanced technology such as data analytics tools for better resolution of complaints and check recurrence of common issues such as mis-selling of insurance products and delayed claim settlement.

More effective complaints redressal mechanism 

Policyholders now register their complaints through the regulator’s Integrated Grievance Management System (www.igms.irda.gov.in) and sometimes approach insurance ombudsman offices directly.

"Both IGMS and the ombudsman offices receive a lot of complaints. We plan to strengthen the mechanism and carry out a root-cause analysis. For instance, data analytics can help us identify policy conditions that trigger large number of complaints,” newly appointed IRDAI Chairman Debashish Panda said recently.

The regulator and the industry can then contemplate eliminating or modifying such policy clauses to prevent recurrence of grievances. The IRDAI is also planning to put in place a mechanism to invite feedback from policyholders after the complaints are disposed of.

“Only after they are satisfied will the matter be closed. We also want to track complaints related to mis-selling, identify companies that delay claim settlement, and take targeted, corrective action that will enhance the policyholders’ trust (in the system),” Panda said.

The insurance regulator tracks complaints registered and insurers’ response through the IGMS on a real-time basis. The ombudsman offices have the authority to issue orders that are binding on the insurance companies. The IGMS provides a standard platform to all insurers to resolve the policyholder grievances and provides IRDAI with a tool to monitor the effectiveness of the grievance redress system of the insurers.

Greater focus on wellness offerings in health insurance policies

The insurance industry wants the regulator to allow them to offer value-added services along with insurance policies.

For example, yoga or health club membership bundled with health insurance policies and discounts on premiums in case policyholders show improvement in their health conditions such as diabetes or hypertension. Some insurance companies had offered similar products, albeit in pilot mode, when IRDAI came up with its sandbox regulations.

“It is currently not allowed. There are restrictions in the Act that do not allow them to do anything else other than insurance business. So, they are unable to roll them (wellness offerings) with their insurance products,” said Panda.

If the modernisation proposal goes through, the policyholders can undergo, say, regular health check-ups at designated centres. Insurers can offer those who are obese an incentive to lose weight. Their longevity will increase and chances of having to seek treatment due to obesity-linked illnesses do down.

“As we go along, claims will come down,” he said. While the regulator did allow insurance companies to offer wellness incentives in some form to policyholders in 2020, the IRDAI will now propose an amendment to the Insurance Act.

“This is a piece that will require an amended. We have prepared and drafted (the modified rules). We will be sending these to the government soon,” said Panda.