In a big relief to policyholders, the Insurance Regulatory and Development Authority (IRDA) today asked insurance companies not to mechanically reject claims on technical grounds, like delay in filing claim documents.
IRDA has issued these directives following complaints that claims are being rejected on grounds of delay in intimation and submission of documents to insurers.
“Rejection of claims on purely technical grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation,” the regulator said in a communication to life and non-life insurance companies.
Although the policyholders are required to file claims within a prescribed time frame, IRDA said, “This condition should not prevent settlement of genuine claims, particularly when there is delay in intimation or in submission of documents due to unavoidable circumstances.”
The regulatory direction is likely to benefit lakhs of policy holders, who face either rejection or delayed settlement of their claims on technical grounds.
Source : http://www.tribuneindia.com/2011/20110922/biz.htm#3
IRDA has issued these directives following complaints that claims are being rejected on grounds of delay in intimation and submission of documents to insurers.
“Rejection of claims on purely technical grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation,” the regulator said in a communication to life and non-life insurance companies.
Although the policyholders are required to file claims within a prescribed time frame, IRDA said, “This condition should not prevent settlement of genuine claims, particularly when there is delay in intimation or in submission of documents due to unavoidable circumstances.”
The regulatory direction is likely to benefit lakhs of policy holders, who face either rejection or delayed settlement of their claims on technical grounds.
Source : http://www.tribuneindia.com/2011/20110922/biz.htm#3
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