The ultimate objective of the Insurance practice is to indemnify the insured/business at the time of happening of any uncertain event. The experience of consumers in claim settlement should be smooth so that they are compensated adequately at the time of distress. But often we witness grudge of customers in getting timely insurance claims.
There is a perception that Insurance Companies do not pay the claim timely and the process is cumbersome. What have we done over the years to improve the perception of consumers, change the mind-set and try to give them a WOW experience so that they become brand ambassador of the insurance and pursue others to buy insurance cover. Somewhere we have lacked in providing that experience and the low penetration of Insurance products may be a significant reason for it.
When IRDAI is focussing for Insurance for All by 2047 and aim to double the penetration, reach out to the last mile, this aspect of consumer satisfaction needs to be kept in mind. Studies and research should be done to understand the perception and behaviour of the consumers. Common complaints from consumers should be segregated and analysed and product, servicing team, Intermediaries team needs to be given the feedback on how to improve this experience.
In this age of technology the system of Insurance companies should be robust to flag and identify any fraudulent claim and reduce the time taken for settlement of claims. The genuine customer should not suffer and the in genuine customers should not be spared. In India I have hardly seen prosecution of criminals who have precipitated frauds. Insurance Companies simply reject the claim when they find it fraudulent. The person responsible for it, simply escapes and prepares for committing another fraud with other insurance company. Till today we could not build an Industry wise date base of Insurance frauds to red flag the habitual offenders and criminals.
The grievance Redressal system still needs lot of reforms and transformations. Insurance Ombudsman is still operating from major cities and yet to reach out to tier 2 and tier 3 cities. The limit of handling of claims by Insurance Ombudsman is also very less. Insurance Ombudsman needs a massive overhauling by increasing its strength, reach, limit and be hassle free so that people can file claims online and they need not visit their office to save cost and time. Hearing should be done online with video recording so that fast Redressal can be given to the consumers.
In many cases it is seen that some Insurers do not adhere to the time limit of the award passed by Insurance Ombudsman and try to circumvent the payment of claims.
Similarly the internal grievance mechanism of Insurers must be made more robust and responsive so that they respond to customers in time and give a satisfactory resolution. In many cases it is seen that even after making a complaint, no proper resolution in provided and the customers have to run from pillar to post to have their grievances heard.
Insurance Arbitration must also be invoked frequently to reduce the time taken in various legal forums and provide early resolution to customer complaints.
IRDAI must take a note to overhaul the grievance management system and make it affordable, quick so that people do not shy away from purchasing insurance and thereby help in increasing penetration.
