Ministry of Finance
Unfair Business Practice by Insurance Companies
Posted On: 23 JUL 2019 by PIB Delhi
The Insurance Regulatory and Development Authority of India (IRDAI) has put in place Integrated Grievance Management System (IGMS), which captures the complaints registered against all insurers. A statement showing the number of complaints received and attended to in the said system against both public and private general insurers during the last 3 years and the current year is given in Annexure.
IRDAI has notified IRDAI (Protection of Policyholders’ Interests) Regulations, 2017. Vide Regulation 5(1)(iv) of the said Regulations, the IRDAI has mandated all insurers to have in place a board approved policy which shall contain steps to be taken to prevent mis-selling and unfair business practices at point of sale and service. Further, vide Regulation 6, prescribed specific point of sale provisions to be complied with by all insurers, agents and intermediaries. In case any insurer, agent, intermediary violates the above provision the IRDAI can initiate action against them.
IRDA (Advertisement and Disclosure) Regulations, 2000 and other guidelines relating to advertisements are aimed at ensuring that any communication (including those on the internet) which directly or indirectly result in eventual sale or solicitation of policy should not be unfair or misleading.
IRDAI has also notified various other regulations namely IRDAI (Appointment of Insurance Agents) Regulations, 2016, IRDAI (Registration of Corporate Agents) Regulations, 2015, IRDAI (Insurance Brokers) Regulations, 2018 prescribing code of conduct for agents, corporate agents and brokers so that they do not resort to mis-selling and unfair business practices at point of sale.
This was stated by Shri Anurag Singh Thakur, Minister of State for Finance & Corporate Affairs in a written reply to a question in Rajya Sabha today.
