The Ministry of Finance, through a recent notification dated 9th November 2023, has introduced significant amendments to the Insurance Ombudsman Rules, 2017. This article delves into the key modifications, addressing changes in financial services institutions, resignation procedures, salary deductions, mediation processes, and award protocols.
Detailed Analysis:
i. Financial Services Institutions Bureau: In Rule 7 of the Insurance Ombudsman Rules, 2017, the amendment replaces references to the “Bank Board Bureau” with the term “Financial Services Institutions Bureau.” The Explanation defines this term as the body constituted by the Ministry of Finance, Department of Financial Services, as per Resolution F. No. 14/1/2022-BO-I, dated the 1st July 2022.
ii. Resignation Protocols: Rule 8 sees the addition of provisos regarding the resignation of Insurance Ombudsmen. Ombudsmen may resign by providing a notice of not less than ninety days, in lieu of three months’ salary. The Council for Insurance Ombudsmen reserves the right to waive the notice, either in part or in full, at its discretion. Notably, if the last day of the notice period falls on a weekend or holiday, the Ombudsman will be relieved on the next working day.
iii. Salary Deductions Omitted: In Rule 10, the amendment removes the provision stating that any pension entitled to an Insurance Ombudsman from the Central Government or a State Government shall be deducted from their salary.
iv. Mediation Process: Rule 16 witnesses a change in the marginal heading to “Complaint settled through mediation by Insurance Ombudsman,” reflecting an emphasis on mediation processes for dispute resolution.
v. Award Protocols: Rule 17 sees amendments in sub-rules (2) and (3). Sub-rule (2) mandates that the award passed by the Insurance Ombudsman must be in writing, signed personally or digitally, and accompanied by reasons for the decision. In sub-rule (3), the word “thirty” is replaced with “fifty” in the proviso, extending the period for certain actions.
Conclusion: The amendments introduced by the Ministry of Finance to the Insurance Ombudsman Rules, 2017, mark a significant step in streamlining processes, enhancing transparency, and adapting to evolving financial landscapes. From aligning with the Financial Services Institutions Bureau to refining resignation protocols and mediation procedures, these changes aim to fortify the efficacy of the Insurance Ombudsman framework.
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MINISTRY OF FINANCE
(Department of Financial Services)
NOTIFICATION
New Delhi, the 9th November, 2023
G.S.R. 828(E).—In exercise of the powers conferred by section 24 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999), the Central Government hereby makes the following rules further to amend the Insurance Ombudsman Rules, 2017, namely: –
1. Short title and commencement: — (1) These rules may be called the Insurance Ombudsman (Amendment) Rules, 2023.
(2) They shall come into force from the date of their publication in the Official Gazette.
2. In the Insurance Ombudsman Rules, 2017 (hereinafter referred to as the principal rules), in rule 7, in sub-rule 2, —
(i) in clauses (b) and clause (c), for the words „Bank Board Bureau‟, the words „Financial Services Institutions Bureau‟ shall be substituted;
(ii) for explanation, the following Explanation shall be substituted, namely: —
“Explanation. —In this sub-rule, the expression “Financial Services Institutions Bureau” means the body constituted by the Ministry of Finance, Department of Financial Services vide Resolution F. No. 14/1/2022-BO-I, dated the 1st July, 2022.‟.
3. In the principal rules, in rule 8, after the provisos, the following provisos shall be inserted, namely: —
“Provided further that the Insurance Ombudsman may resign by giving prior notice in writing of not less than ninety days in lieu of three months‟ salary, to the Council for Insurance Ombudsmen, informing his intention to resign;
in case the last date of notice period falls on Saturday or Sunday or holiday, the Insurance Ombudsman shall be relieved on the next working day.
Provided also that the Council for Insurance Ombudsmen reserves the right to waive the notice in part or in full at its discretion.”.
4. In the principal rules, in rule 10, in sub-rule (1), the words “and any pension to which he is entitled from the Central Government or a State Government shall be deducted from his salary” shall be omitted.
5. In the principal rules, in rule 16, for the marginal heading, the following marginal heading shall be substituted, namely: —
“Complaint settled through mediation by Insurance Ombudsman.”.
6. In the principal rules, in rule 17, –
(i) for sub-rule (2), the following sub-rule shall be substituted, namely: —
“(2) The award passed under sub-rule (1) shall be in writing, duly signed in person or digitally by the Insurance Ombudsman with reasons for passing such award.”.
(ii) in sub-rule (3), in the proviso, in clause (ii), for the word „thirty‟, the word “fifty” shall be substituted.
[F. No. S-14014/12/2022-Ins.I]
MUKESH KUMAR BANSAL, Jt. Secy.
Note : The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), dated the 27th April, 2017, vide G.S.R. 413 (E), dated the 25th April, 2017 and were subsequently amended vide G.S.R. 785(E) dated the 17th August, 2018 (published on 20th August, 2018), G.S.R. 147(E) dated the 2nd March, 2021 and lastly vide G.S.R. 334(E) dated the 18th May, 2021.
