Page 80 - Insurance Surveyors Book Ebook IC S01

Survey And Loss Assessment IC-S01

Monopoly and Restrictive Trade Practices Act (MRTP) and Standards and

Weight Measures Act are other legislations towards the same end and now it is

the ombudsman scheme especially designed to protect the insured, wherever

he is aggrieved against any insurer.

The Malhotra Committee while recommending the entry of private enterprise

into the insurance sector had foreseen the possibility of increasing number of

disputes and had consequently recommended setting up of the institution of

ombudsman, with a view to reduce litigation.

Insurance selling is called concept marketing as it relates to the selling of an

idea only. It is difficult to determine objectively the quality of services and

therefore leads to higher degree of disputes. In insurance, the sacrifice is real

and immediate while the benefits are distant and contingent. The aggrieved

party appears almost helpless before the mighty insurer with his financial

backing. In all such cases, the content of empathy with the insured, makes any

balanced judgment rather difficult.

In view of the complications involved, the Draft of Redressal of Public

Grievances Rule 1998, provided pursuant to Sec. 114(1) of the Insurance Act

1938, to set up an institution of ombudsman,, with three members - one from

judiciary, one from insurance and the third from Civil service with a three year

tenure. The object of these Rules is to "resolve all complaints relating to

settlement of claims on the part of the insurance companies in a cost effective,

efficient and impartial manner." However, if any insurance company has an

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