Ministry Notification

14. Ombudsman to act fairly and equitably
(i) The Ombudsman may, if he deems fit, adopt a procedure other than mentioned in sub-rule (1) and (2) of Rule 13 for dealing with a claim, Provided that the Ombudsman may ask the parties for necessary papers in support of their respective claims and where he considers necessary, he may collect factual information available with the insurance company.
(ii) The Ombudsman shall dispose of a complaint fairly and equitably.

15. Recommendations made by the Ombudsman:
(i) When a complaint is settled, through mediation of the Ombudsman, undertaken by him, in pursuance of request made in writing by complainant and insurer through mutual agreement, the Ombudsman shall make a recommendation which he thinks fair in the circumstances of the case. The copies of the recommendation shall be sent to the complainant and the insurance company concerned. Such recommendation shall be made, not later than one month from the date of the receipt of the complaint.
(ii) If a complainant accepts the recommendation of the Ombudsman, he will send a communication in writing, within 15 days of the date of receipt of the recommendation. He will confirm his acceptance to the Ombudsman and state clearly that the settlement reached is acceptable to him, totally, in terms of recommendations made by the Ombudsman in full and final settlement of the complaint.
(iii) The Ombudsman shall send to the insurance company, a copy of the recommendation along with the acceptance letter received from the complainant. The insurer shall thereupon comply with the terms of the recommendations not later than 15 days of the receipt of such recommendation, and the insurer shall inform the Ombudsman of its compliance.

16. Award:
(i) Where the complaint is not settled by agreement under Rule 15, the Ombudsman shall pass an award which he thinks fair in the facts and circumstances of a claim.
(ii) An award shall be in writing and shall state the amount awarded to the complainant, Provided that Ombudsman shall not award any compensation in excess of what is necessary, to cover the loss suffered by the complainant as a direct consequence of the insured peril, or for an amount not exceeding rupees twenty lakhs (including ex-gratia and other expenses), whichever is lower.
(iii) The Ombudsman shall pass an award within a period of three months from the receipt of the complaint.
(iv) A copy of the award shall be sent to the complainant and the insurer named in the complaint.
(v) The complainant shall furnish to the insurer, within a period of one month from the date of receipt of the award, a letter of acceptance that the award is in full and final settlement of his claim.
(vi) The insurer shall comply with the award within 15 days of the receipt of the acceptance letter under sub-rule (5) and it shall intimate the compliance to the Ombudsman.

17. Consequences of non-acceptance of award: If the complainant does not intimate the acceptance under sub-rule (5) of rule 16, the award may not be implemented by the insurance company.