In a move aimed at enhancing consumer trust and ensuring timely grievance redressal, the Insurance Regulatory and Development Authority of India (IRDAI) has proposed the IRDAI (Internal Insurance Ombudsman) Guidelines, 2025. These guidelines are designed to streamline the complaint management systems within insurance companies and promote accountability, transparency, and fairness in dealing with policyholders’ issues.
The guidelines are proposed under Section 14(2)(b) of the IRDA Act, 1999, read with Regulation 56 of the IRDAI (Protection of Policyholders’ Interests, Operations and Allied Matters of Insurers) Regulations, 2024.
Background and Stakeholder Engagement
The draft guidelines were initially shared with the General Insurance (GI) and Life Insurance (LI) Councils on October 25, 2023. After incorporating their feedback, the proposals were further refined during the Bima Manthan meetings held with CEOs of life and general insurance companies in January 2024. Additionally, the draft was reviewed by the Advisory Committee constituted under Rule 9 of the Insurance Ombudsman Rules, 2017, whose inputs have also been considered and included.
Key Features of the Proposed Guidelines
Scope & Applicability:
These guidelines will apply to all insurers (excluding reinsurers) that have completed three years of operations.
Effective Date:
The guidelines will come into effect three months from the date of issuance.
Eligibility Criteria for Appointment:
An Internal Insurance Ombudsman (IIO) must:
Have at least 20 years of experience in the insurance sector.
Have held a senior position (minimum two levels below Board Director).
Not be associated with the insurer or its group companies, past or present.
Age & Tenure
A fixed 3-year term, with a possible one-time renewal for another 3 years.
Minimum and maximum age limits will be defined to ensure competence and independence.
Reporting Structure:
The IIO will report administratively to the MD/CEO, and functionally to the Board or the Policyholder Protection, Grievance Redressal & Customer Management (PPGR & CM) Committee.
Multiple Appointments:
Based on volume of complaints or geographic spread, insurers may appoint more than one IIO, with clear jurisdiction defined for each.
Remuneration:
The Board of the insurer will determine the compensation.
Once fixed, remuneration will remain constant during the term, except for a pre-approved annual increase.
Jurisdiction & Powers:
IIOs can hear complaints involving claims up to ₹50 lakhs.
They can take up:
Unanswered complaints pending beyond 30 days.
Rejected or partially resolved complaints where the complainant seeks further review.
Binding Decisions:
Each decision must be a “reasoned decision” and is binding on the insurer.
Appeals Process:
Policyholders dissatisfied with the IIO’s decision may appeal to the Insurance Ombudsman within 30 days under the Insurance Ombudsman Rules, 2017.
Call for Comments
IRDAI invites all stakeholders, including insurers, policyholders, and consumer advocates, to review the proposed guidelines and submit their feedback in the prescribed format by 5:00 PM on August 17, 2025. Suggestions should be emailed to Mr. D. Rajanikant (rajanikanth@irdai.gov.in) with a copy to Shri Gautam Kumar (gautam.kumar@irdai.gov.in).
These guidelines represent a significant step toward building a more responsive and structured framework for grievance redressal in the insurance sector, aligning with IRDAI’s broader mission to protect policyholder interests and foster trust in the insurance ecosystem.