Insurance Ombudsman and Bima Bharosa: complaining about a business insurance claim

If your insurer delays, reduces or rejects a business insurance claim, first complain in writing to the insurer's grievance redressal officer. If you are not satisfied with the reply, or get none within the time IRDAI requires, register the complaint on Bima Bharosa, IRDAI's grievance management system. Separately, the Insurance Ombudsman under the Insurance Ombudsman Rules, 2017 offers a free, informal route for complaints from individuals, and for policies issued to sole proprietorships and micro enterprises, within a monetary cap of ₹50 lakh per complaint (raised from ₹30 lakh in November 2023). Larger companies, and claims above the cap, usually go to a consumer commission, arbitration or civil court instead.

This guide belongs to why liability claims are rejected. Rules and limits can change; check the Council for Insurance Ombudsmen and IRDAI before filing. If you are not eligible for the Ombudsman, see consumer commission disputes; for presenting the original claim, see how to file a liability claim.

The escalation ladder

Stage 1: the insurer's grievance cell

Every insurer must have a grievance redressal policy and a grievance officer, with contact details on its website and in the policy document. Write clearly:

• Policy number, claim number, dates
• What the insurer decided and why you disagree
• Documents supporting your case
• What you want: payment of ₹X, reconsideration, or a reasoned decision

Ask for an acknowledgement and complaint reference. IRDAI's guidelines require insurers to acknowledge and resolve complaints within set periods (historically acknowledgment within a few days and resolution within about two weeks); check the current master circular for the exact timelines.

Stage 2: Bima Bharosa

Bima Bharosa replaced IRDAI's earlier Integrated Grievance Management System (IGMS). You can register a complaint online on the Bima Bharosa portal, and IRDAI's grievance call centre also accepts complaints. The system forwards the complaint to the insurer, tracks timelines and records the outcome.

Bima Bharosa does not decide the claim like a court. It makes sure the insurer handles the complaint properly. If you remain unhappy after the insurer's final reply, move to Stage 3 or 4.

Stage 3: the Insurance Ombudsman

Who can complain

The Insurance Ombudsman Rules, 2017, as amended in 2021 and 2023, allow complaints by:

• Individuals holding personal policies
• Members of group policies
• Policies issued to sole proprietorships and micro enterprises

A private limited company that is not a micro enterprise, or a larger business generally, cannot use the Ombudsman. Micro enterprise status is decided under the MSME classification; check your Udyam registration and the current thresholds.

What you can complain about

• Delay in settling a claim beyond the time set in the regulations
• Partial or total repudiation of a claim
• Disputes about premium paid or payable
• Misrepresentation of policy terms
• Policy servicing issues and grievances against agents and intermediaries, under the 2021 amendments

Conditions

• You must have complained to the insurer first, and the insurer must have rejected the complaint, not replied within one month, or replied unsatisfactorily
• File within one year of the insurer's reply (or of the expiry of the one-month period if it did not reply)
• The matter must not be pending in, or decided by, a court, consumer commission or arbitrator
• The amount in dispute, including expenses, must be within the ₹50 lakh cap

How it works

1. File online or with the Ombudsman office that has jurisdiction over the insurer's branch or your address.
2. The Ombudsman may try mediation and recommend a settlement.
3. If not settled, the Ombudsman passes an award, normally within three months of receiving all requirements.
4. The award is binding on the insurer, which must comply within 30 days. The complainant is not bound; you can still go to another forum if you do not accept it.

Worked example: is the Ombudsman available?

Preparing a strong complaint

• Timeline: dates of incident, notice, claim, documents sent, decision
• Policy clauses: quote the insuring clause and the exclusion relied on
• Evidence: proposal form, schedule, emails, surveyor's report, photographs
• Your argument: why the facts fall within cover or why the exclusion does not apply
• Remedy: exact amount claimed with calculation, and interest if delay is an issue

Frequently asked questions

Is the Ombudsman free?

Yes. There is no fee, and you do not need a lawyer, though you can be represented.

Can my company use the Ombudsman for a liability claim?

Only if it is a sole proprietorship or a micro enterprise, or the policy is a personal or group policy within scope, and the amount is within the cap.

Does a complaint on Bima Bharosa stop the time limit for a consumer complaint?

Do not assume so. The limitation period for a consumer complaint is two years from when the cause of action arose, and time spent complaining elsewhere may not be excluded. Take advice early.

Can I go to the Ombudsman and a consumer commission at the same time?

No. The Ombudsman will not take a matter pending before another forum.

Sources

• Council for Insurance Ombudsmen — Ombudsman offices, jurisdiction and online complaint filing
• Bima Bharosa — IRDAI grievance registration and tracking
• IRDAI — Insurance Ombudsman Rules, 2017 and grievance guidelines
• Udyam Registration — MSME classification for micro enterprises