Insurance Awareness Capsule for LIC AAO, NIACL AO and Assistant Exam. Today in this Article we will Discuss about Insurance Governing Bodes in India – IRDAI, IBAI and Insurance Ombudsman, their objective and Functions in Detail.
Insurance Governing Bodies in India :-
II. General Insurance Council
III. Insurance Ombudsman
Lets Discuss all these Insurance Governing Bodies in Detail :-
Insurance Brokers Association of India (I.B.A.I.)
Brokers Association of India (I.B.A.I.) was established as a Company under
Section 25 of the Companies Act, 1956 on 25th July 2001. IBAI is run by a Board
of Directors who are elected by the members. IBAI is a member of Bombay Chamber
of Commerce and Industry, Mumbai as well as of Federation of Indian Chambers of
Commerce and Industry. Only I.R.D.A. licensed insurance brokers are considered
for membership of I.B.A.I.
Goal: The main aims of IBAI are to
encourage communication among the Insurance/Re-insurance Broker members and to
support, promote, and protect the interests of the members of IBAI.
I. It aims to provide an opportunity to the members for
auxiliary education, training and research in all fields of insurance and
II. It takes care of the interests of Brokers with other
organizations. Insurance Brokers Association of India (I.B.A.I.) is the only
Insurance Regulatory and Development Authority (I.R.D.A.)-recognized body of
licensed Insurance Brokers.
III. According to the Insurance Brokers’ Regulations 2002
outlined by the I.R.D.A., all licensed Brokers should be member of I.B.A.I.
Direct Insurance Brokers, Composite Insurance Brokers and Re-Insurance Brokers
are members of I. B. A. I.
The General Insurance (GI) Council is a part of
the Insurance Association of India. It regulates the growth of the general
insurance industry and maintains high quality customer service. The GI council
has also strengthened its ties with several international insurance
In 1957, the General Insurance Council was
established under the Indian Insurance Act 1938. It designed a code of conduct
to ensure fair business practices. The Insurance Act was modified in 1968 to
monitor the flow of major investments and reduce solvency margins. After the
General Insurance Business Act was passed in 1972, the constitutional body
underwent nationalization. About 107 insurance providers merged and divided
into four companies, New India Assurance Company Ltd, National Insurance
Company Ltd., United India Insurance Company Ltd, and Oriental Insurance
Company Ltd. As a nationalized body, the GI Council actively started business
on 1st January, 1973.
of General Insurance Council
The insurance domain is growing at the rate of
15-20% annually. As a matter of fact, it nearly contributes 7% to the GDP of
India. The Insurance Regulatory and Development Authority have played a vital
role in the insurance sector. Since four decades, the GI Council has rendered
immaculate services to every individual in the country. The statutory body aims
- Expand the general insurance sector
- Facilitate economic development
- Provide long-term funds for growth
- Represent the general insurance industry as an
authoritative collective voice
- Resolve social issues such as insurance fraud and theft
The institution of Insurance Ombudsman was created by a
Government of India Notification dated 11th November, 1998 with the purpose of
quick disposal of the grievances of the insured customers and to mitigate their
problems involved in redresal of those grievances. This institution is of
great importance and relevance for the protection of interests of policy
holders and also in building their confidence in the system. The institution
has helped to generate and sustain the faith and confidence among the consumers
Appointment of Insurance Ombudsman
The governing body of insurance council issues orders of
appointment of the insurance Ombudsman on the recommendations of the committee
comprising of Chairman, IRDA, Chairman, LIC, Chairman, GIC and a representative
of the Central Government. Insurance council comprises of members of the Life
Insurance council and general insurance council formed under Section 40 C of
the Insurance Act, 1938. The governing body of insurance council consists of representatives
of insurance companies.
Ombudsman are drawn from Insurance Industry, Civil Services
and Judicial Services.
Terms of office
An insurance Ombudsman is appointed for a term of three years
or till the incumbent attains the age of sixty-five years, whichever is
earlier. Re-appointment is not permitted.
The Insurance Ombudsman are appointed by the Governing Body of Insurance
Council (GBIC) and are empowered to entertain complaints on the following
aspects in respect of personal line insurance:
Partial or total repudiation of claims by an insurer
b. Delay in settlement of claims
c. Any disputes in regards to premiums paid or payable in terms of the policy
d. Any dispute on the legal construction of the policies in so far as such
disputes relate to claims.
e. Non-issue of Insurance document to Customers after receipt of premium.
Important Points related to Insurance Ombudsman
I. The complainant can approach the Office of
Insurance Ombudsman as per jurisdiction, for value of the claim including
expenses not exceeding Rs 20 lacs, within 1 year from the date of
rejection/repudiation/partial settlement of claim by the Insurer.
II. The complaint shall be in writing duly signed by
the policyholder or claimant/ legal heirs.
III. The forum of Insurance Ombudsman does not charge
any fees for filing the complaint.
IV. The complainant should not have approached any
other forum/court/arbitrator on the same subject matter of the claim.
V. 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.
VI. 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.
VII. There are Total -12 Insurance Ombudsmen Officer across India.
Why Should you Take Unacademy Plus Subscription – Up to 45% Discount Available