The government on Wednesday notified the amendment to Insurance Ombudsman Rules, 2017 to improve the mechanism for timely, cost-effective and impartial resolution of complaints regarding deficiencies in insurance services.
"The amended rules have enlarged the scope of complaints to ombudsmen from only disputes earlier to deficiencies in service on the part of insurers, agents, brokers and other intermediaries," the Finance Ministry said in a statement.
Insurance brokers have also been brought under the ambit of ombudsman mechanism.
The policyholders can now make complaints electronically to ombudsman and a complaints management system will be created to enable policyholders to track the status of their complaints online.
"Further, the ombudsman may use video-conferencing for hearings. To enable access to relief through the ombudsman mechanism even when there is vacancy in the office of a particular ombudsman, provision has been made for giving additional charge to another ombudsman, pending the filling of the vacancy," the statement said.
Amendments have also been made for securing the independence and integrity of ombudsman selection process, while also building in safeguards to secure the independence and impartiality of the appointed persons while serving as ombudsman. The selection committee will also include an individual with a track record of promoting consumer rights or advancing the cause of consumer protection in the insurance sector.
The ombudsman mechanism was administered by the Executive Council of Insurers, which has been now renamed as the Council for Insurance Ombudsmen.