In a consumer-friendly action, the Insurance Regulatory and Development Authority (IRDA) has started monitoring claim settlements of both life and non-life insurance companies to detect unwarranted delays in payouts. If found violating, insurance companies will face heavy penalties.

“We have set in motion a process wherein claim settlement patterns of companies are being watched and inspected,” a senior IRDA official said. “In cases where we feel there are irregularities, we are calling the CEO (chief executive officer) and asking for an explanation.

We will penalise companies who are refusing claims on unfair grounds.” As part of its efforts to ensure that insurers quickly redress grievances, IRDA had launched the integrated grievance management system last year, wherein customers could register their complaints online and track its status.

Industry insiders say that by examining the claims data of companies for patterns, IRDA wants to go beyond just facilitating complaints resolution.

It is classifying complaints into different categories to identify instances of violation/non-compliance by insurance companies so that regulatory action could be taken wherever required. Sanjeev Pujari, appointed actuary, SBI Life Insurance Co. Ltd, said that rather than the internal claim experiences of companies, the regulator is more concerned about the claims settled by a company and the time taken by it to do so. “Delay in settlement of claims or refusing claims on unjust grounds are unfair practices that IRDA is worried about,” he said.