Page 41 - The Insurance Times October 2025

5.5 Regulatory Clarity and Standards 6.6 Public Awareness and Accessibility
The majority of jurisdictions for insurers do not mandate Policyholders should be made aware, at the time of the sale
internal ombudsmen. Without understanding its jurisdiction, and at the time of the claim, about the existence and
independence, and disclosures, it is dubious that it could process of the Internal Ombudsman. This could be done
avoid becoming a token appointment or misapplied. through welcome kits, call centre scripts, SMS alerts, and
insurer apps.
6. Policy Recommendations
To operationalise the Internal Insurance Ombudsman 7. Conclusion
concept effectively, the following multi-pronged policy Towards a more consumer-driven and digitally transparent
framework is recommended: world, grievance redressal in the insurance ecosystem
represents a strategic differentiator rather than a compliance
6.1 Regulatory Mandate burden. The external ombudsman schemes have provided
IRDAI should consider making the appointment of IIOs improved access to justice, but their post-dispute nature and
mandatory, particularly for insurers that write a large systemic limitations require a more proactive stance.
volume of retail business. The model may be voluntary for
smaller players, with minimum standards specified. The Internal Insurance Ombudsman, if implemented with
integrity, independence, and accountability, can fill this
6.2 Charter of Independence critical gap. It reduces regulatory and reputational risks and

Each IIO should establish a Charter of Independence - a enhances consumer trust, operational agility, and ethical
formal document that sets out: accountability. The IIO can transform grievance redressal
The limits of authority, from a reactive function into a driver of continuous
improvement and customer loyalty by resolving disputes
Lines of reporting,
early, identifying systemic failures, and gathering insights
Case confidentiality rules, into core operations.
Procedural timelines and fairness,
The Internal Insurance Ombudsman should be recognised
A conflict-of-interest policy.
as a key pillar of responsible governance as the insurance
The Office's charter should be publicly available on their
industry evolves toward inclusive, transparent, and resilient
policies and websites. models.
6.3 Regulatory Oversight and Reporting 8. References
The board of directors and the insurance regulator should https://www.afca.org.au/
ask for annual reports with detailed patterns of complaints,
https://www.cioins.co.in/
outcomes, and recommendations, which should be
considered in their conduct supervision and product https://www.coverfox.com/health-insurance/articles/
suitability activities. ombudsman-in-india/
https://economictimes.indiatimes.com/wealth/insure/
6.4 Capacity Building rising-insurance-grievances-push-irdai-to-propose-
Insurers should devote resources to training ombudsman internal-insurance-ombudsmenbut-will-it-stay-neutral-
staff in mediation, insurance law, ethics, and customer on-insurer-payroll/articleshow/123055282.cms
psychology. The regulator may also undertake periodic https://financialservices.gov.in/beta/index.php/en/
certifications or a knowledge-sharing method similar to the banking-ombudsman
banking ombudsman schemes.
https://www.financial-ombudsman.org.uk/

6.5 Integration with ERM and Audit https://irdai.gov.in/press-releases
The IIO reports should be incorporated into enterprise risk https://www.legalserviceindia.com/legal/article-6133-
management (ERM) assessments, compliance audits, and analysis-of-insurance-ombudsman-scheme-in-
company product development processes. This is how to india.html#google_vignette
ensure that complaints are addressed at not just an https://www.paybima.com/blog/miscellaneous/what-is-
individual level but at the root cause level. insurance-ombudsman-everything-you-need-to-know.

38 October 2025 The Insurance Times