Twenty years ago, at age 45, S Krishnan* bought a moneyback policy from a Kolkata branch of the Life Insurance Corporation of India (LIC). He was assured of a payback every five years and a lumpsum bonus payout at the end of 20 years. Krishnan, however, was in for a shock when, last year, at age 65, he was asked by the state-owned insurer to open a bank account in the name of Sundaresan Krishnan (his name, with an expanded initial, as reflected in his PAN card) in order to get the promised lumpsum bonus.

The insurance agent declined to help, and so Krishnan wrote to the LIC branch manager. After a bit of back and forth, mostly to acquaint LIC officers with the peculiarities in the naming convention among South Indians, Krishnan secured redress to his problem.

“It was initially difficult to make them understand that South Indians do not necessarily have a surname, and instead use an initial. When I explained that, they were understanding, and arranged for me to get the lumpsum bonus in my account,” Krishnan told BusinessLine .

Drop in complaints Building trust through efficient servicing, at the time of policy issuance and when claims are made, is a critical element in the success of any insurance product in both the life and the non-life space. Bearing this in mind, life and general insurance companies have stepped up their game in the area of grievance redress.

This is evident in the drop in the number of complaints against life and general insurers in 2016-17. Data put out by the Consumer Affairs Department of the insurance regulator, the Insurance Regulatory and Development Authority of India (IRDAI), points to a 40 per cent drop in the number of complaints reported against life insurance products and policies — at 1,22,613 in 2016-17, against 2,04,701 in FY16. The number of pending complaints as on March 31, 2017 was 247, against 935 at the same time in the previous year. In the case of general insurance, there was an 11 per cent reduction in complaints registered — at 52,908 in FY17, against 59,083 in FY16. According to P Nandagopal, Founder and CEO, Insurance Inbox, an insurance advisory company, the complaints against life insurers relate more to policy mis-selling; in the case of general insurers, most of the complaints relate to claims not being settled.

In the non-life category, motor insurance policies sell the most, but the most number of complaints relate to health insurance policies. “The number of complaints has started coming down in the recent past due to awareness campaigns taken up by the IRDAI,” Nandagopal said.

The industry as a whole witnessed a 34 per cent drop in the number of complaints reported — at 1.73 lakh in FY17, against 2.64 lakh in FY16. According to Sanjay Datta, Chief-Underwriting & Claims, ICICI Lombard General Insurance Company, the use of IT has helped speed up the process and efficiency of policy issuance. And on the claims side, the standardisation of products and processes has made things simpler.

The due process IRDAI mandates insurance companies to resolve grievances within two weeks of their receipt. If a customer is unhappy with an insurance company or an intermediary, s/he can approach the grievance redressal officer of the insurer.

If the complaint is not resolved within two weeks, the complainant can approach the Consumer Affairs Department of IRDAI, which then plays the role of a facilitator.

In April 2011, the insurance regulator launched the Integrated Grievance Management System (IGMS), which not only provides centralised access to the policyholder but also gives complete access and control to IRDAI to monitor market conduct issues taking policyholders’ grievances as the main indicator.

IGMS classifies different complaint types based on pre-defined rules. The system can assign, store and track unique complaint IDs. It also sends intimations to various stakeholders as required, within the workflow. It has defined Target Turnaround Times and measures the actual performance on this count on all complaints. These apart, there are 17 Insurance Ombudsmen in different parts of the country. The Ombudsman can be approached in case of partial or total repudiation of claims by an insurance company; disputes regarding premium paid; and disputes relating to legal construction of policies relating to claims; and delays in claims settlement.

Insurers up their game To ensure quick and efficient redress of grievances, Cigna TTK has a centralised dedicated team, which undergoes intensive training and is equipped to handle diverse customer complaints, Sandeep Patel, CEO & MD of the company, said.

“As a process, we acknowledge a complaint within three days of its receipt and provide resolution within 14 days,” he said.

Customers who don’t understand the features of an insurance product are quick to be dissatisfied with the policies. To address this, Bajaj Allianz General Insurance has been proactive in engaging with customers to ensure that they understand the products and features well. “We engage with customers often — not just at the time of receiving claims — to ensure that they understand the products better. This helps bring down the number of complaints,” KV Dipu, Head of Operations and Customer Care, Bajaj Allianz, said.

According to Vijaya Sanjay Nene, Director, Operations and Services, PNB MetLife India, the insurer has a robust mechanism of grievance handling, which provides customers many channels to approach the company. The insurer has also set up a dedicated team to take faster decisions on resolutions, which is integrated with distributors for fair assessment.

* name changed on request

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