The Insurance Regulatory and Development Authority of India (IRDAI), through its circular dated 23 July 2026, has issued important directions to all insurers, other than reinsurers, regarding the timely submission of Self-Contained Notes (SCNs), supporting documents and additional information sought by the Offices of the Insurance Ombudsman.
1. Background and Rationale
IRDAI has expressed concern over inordinate delays by insurers in submitting SCNs, supporting documents and additional information required by Insurance Ombudsman offices. It has also noted that insurers have been providing follow-up information piecemeal and with considerable delay, resulting in delays in the disposal of complaints raised by policyholders and beneficiaries.
The circular emphasises that timely availability of the SCN and supporting material is essential for the Insurance Ombudsman to properly examine the facts of a complaint and arrive at a decision. The requirement is also linked to Rule 15(2) and Rule 17(4) of the Insurance Ombudsman Rules, 2017, with Rule 17(4) requiring a complaint to be decided within 90 days of receipt of all requirements from the complainant.
2. Key Timelines Prescribed
The circular establishes clear timelines for insurers:
| Requirement | Timeline |
|---|---|
| Submission of Self-Contained Note (SCN) with relevant supporting documents | Within 7 days of receipt of notice from the concerned Insurance Ombudsman office |
| Submission of additional information/documents sought under Rule 15(2) | Within 3 days of receipt of notice |
| Submission of information and documents | In one go, and not piecemeal |
| Clearance of all pending SCN and document/information requirements existing as on the date of the circular | Within 30 days from issuance of the circular |
These requirements are expressly intended to facilitate timely disposal of complaints and improve the overall efficiency of the Insurance Ombudsman system.
3. Significant Consequence of Non-Compliance
The most significant aspect of the circular is the consequence for insurers that fail to comply with the prescribed timelines.
Where an insurer does not provide the required SCN, information or documents within the prescribed time, the concerned Insurance Ombudsman office may proceed with the matter ex parte, without further delay, based on the material information available on record.
This is a material compliance risk for insurers because failure to submit information within the prescribed timelines could result in the insurer losing the opportunity to place its complete factual and documentary position on record before the Ombudsman.
4. Compliance Implications for Insurers
The circular requires insurers to strengthen their internal processes for handling Insurance Ombudsman matters. In particular, insurers should ensure:
- Immediate identification and escalation of Ombudsman notices;
- Clear ownership of each Ombudsman complaint within the organisation;
- Preparation and submission of a complete SCN with all relevant supporting documents within seven days;
- A mechanism to respond to subsequent requests for information within three days;
- Submission of all relevant information and documents comprehensively in a single consolidated response;
- Maintenance of a centralised tracker for all pending Ombudsman matters and deadlines; and
- Immediate review and closure of all pending requests covered by the circular within the 30-day transition window.
5. Operational and Governance Impact
The short timelines prescribed by IRDAI make this more than a routine documentation requirement. Insurers will need to ensure cross-functional coordination between grievance redressal teams, legal departments, claims departments, underwriting teams, compliance functions and the relevant business units.
The requirement to submit information "in one-go" also indicates IRDAI's expectation that insurers should undertake a comprehensive review of each case before responding, rather than adopting an incremental approach to document submission.
From a governance perspective, insurers may consider reporting the status of Ombudsman cases and compliance with prescribed timelines to their senior management and relevant oversight committees, particularly where delays or repeated non-compliance are identified.
6. Key Risk Areas
The principal risks arising from non-compliance include:
- Ex parte proceedings before the Insurance Ombudsman;
- Inability of the insurer to place its complete defence or factual position on record;
- Potential adverse outcomes in complaints due to incomplete documentation;
- Increased regulatory scrutiny of the insurer's grievance redressal mechanism;
- Reputational impact arising from delayed complaint resolution; and
- Possible governance concerns where repeated delays indicate deficiencies in internal complaint-handling processes.
7. Overall Assessment
The circular represents a clear regulatory push by IRDAI towards speedier and more efficient resolution of policyholder and beneficiary grievances. While the circular does not introduce a new substantive obligation regarding the merits of insurance claims, it significantly strengthens the procedural discipline and response timelines expected from insurers in proceedings before the Insurance Ombudsman.
The seven-day timeline for SCNs, three-day timeline for additional information, and the requirement to provide information comprehensively rather than piecemeal should be treated as critical operational compliance requirements. The possibility of ex parte disposal in cases of non-compliance materially increases the importance of timely and complete responses.
In practical terms, insurers should immediately review their existing Insurance Ombudsman case-management processes, establish robust escalation mechanisms and ensure that every notice received from an Ombudsman office is tracked against the prescribed three-day and seven-day deadlines. The 30-day requirement for clearing all pending requests also calls for an immediate internal audit of outstanding SCNs, documents and information sought by the Ombudsman offices.
No comments:
Post a Comment