What is the Insurance Ombudsman Scheme?

With the concurrence of the IRCSL and as part of the Insurance Sector Reforms, a voluntary scheme entitled “Insurance Ombudsman, Sri Lanka” has been established by the Insurance industry, comprising all the Insurance Companies in Sri Lanka that are supervised by the Insurance Regulatory Commission of Sri Lanka (IRCSL). The Scheme is funded by the Insurance Association of Sri Lanka (IASL) which comprises of all the registered and licensed Insurance Companies in Sri Lanka. The Ombudsman Scheme was established in February 2005.

The objective of the Ombudsman scheme is the satisfactory settlement and resolution of complaints/disputes by customers of insurance institutions covered by the Scheme with power to make monetary awards binding on the participating insurance institutions.

Who is the Insurance Ombudsman, Sri Lanka?

The Ombudsman is known as The Insurance Ombudsman, Sri Lanka.
The Insurance Ombudsman is a person of high repute with experience in Administration, Law, Insurance and Financial Services. He has been selected by the IASL with the concurrence of the IRCSL.

For more information about the current Ombudsman, click here.

What are the Ombudsman’s powers?

The Insurance Ombudsman has the power to inquire into and settle any complaints and disputes between individual customers and the insurance institutions covered by the Ombudsman Scheme.

What complaints are covered by the Ombudsman Scheme?

The following are matters on which a complaint can be made under the Ombudsman Scheme

a) Non-settlement or delay in the settlement of a claim

b) Inequitable or unjust interpretation or application of the terms and conditions of the insurance policy with regard to the following:
(i) Claims including maturities of long-term insurance policies
(ii) Premium payable and Premium refunds
(iii) Other benefits payable in terms of the insurance policy

c) Any matters that may be specified or referred to the Ombudsman by the Insurance Regulatory Commission of Sri Lanka (IRCSL) or the Consumer Affairs Authority of Sri Lanka (CAA).

d) Complaints in respect of charges/fees levied.

e) Complaints by registered/licensed Insurance Brokers against Insurance Companies and vice versa.

Who is entitled to complain?

If you are a customer (policyholder) of an Insurance Institution to whom this Ombudsman Scheme applies and you have a good reason, you can make a complaint.

For the list of insurance institutions covered by this Scheme, click here.

To whom in the insurance institution should you first complain?

To any relevant officer of the insurance institution that sold you the policy. Please make a note of the name of the officer and if you exchange correspondence on the matter, please keep copies of such correspondence.

Are there any Forms you must fill up to complain and what is the procedure to be followed?

At the commencement of the Ombudsman scheme in February 2005, there were special forms to fill up. But now the Ombudsman does not require any special forms. All you need to do is to submit a written complaint stating the policy number, the name of the company and a brief account of the complaint.

What are the rules that will guide or bind the Ombudsman?

The Ombudsman is not bound to observe any procedure or rules relating to evidence etc. like a Judge in a court of law. The Ombudsman is entitled to follow any procedure considered appropriate. The Ombudsman will be guided by the evidence placed before him/her, principles of Insurance Law and Practice, Directives issued by the IRCSL and the Codes of conduct and Manual of Procedures used by the insurance institution in question. The Ombudsman is more concerned with what is just and equitable and will always act in the interest of justice in each case.

While a Lawyer/Attorney-at-Law can draft your complaint or help you to draft your complaint, no lawyer is permitted to appear before the Ombudsman.

You cannot make a complaint to the Ombudsman if :
a. You have previously made a complaint and the matter was investigated by the Ombudsman and a decision given.
b. A complaint that has already been investigated by the IRCSL.
c. Your complaint is already the subject matter of proceedings before any Court of Law/Tribunal/Arbitration etc.
The Ombudsman also has the right to reject and/or not proceed to inquire into any complaint if in the Ombudsman’s opinion:

a. The complaint is frivolous/vexatious or was made in bad faith or without sufficient cause.
b. That the complainant has not pursued the complaint with reasonable diligence.
c. There was no real loss or damage or inconvenience caused to the complainant.
d. The complaint is of a complicated nature which requires consideration of elaborate documentary and oral evidence or involved complicated legal issues which are not appropriate for an inquiry or decision by a person such as the  Ombudsman.

How does the Ombudsman inquire into and settle a dispute and what Award can the Ombudsman make?

When the Ombudsman’s Office receives a complaint it will first satisfy itself that the complaint conforms with the Rules. For example (a) that the complaint has been first submitted to the insurance institution (b) that it is in writing and signed by the complainant and other requirements as specified earlier.

If the Ombudsman is satisfied that the complaint is worthy of investigation, the Ombudsman’s office will get all the necessary information and documents from the complainant and the relevant insurance institution.

The Ombudsman Office will then endeavour to promote a settlement of the complaint/dispute to the satisfaction of the complainant.

If any Award of the Ombudsman is over Rs. 1,000,000/= the insurance company can if they so wish to contest such Award in an Arbitration or in a Litigation with the complainant. However, in such a case, the Insurance companies have agreed that the Ombudsman’s Award etc can be produced in evidence without objection by the insurance company at such Arbitration or Litigation.

Apart from Awards which are binding as aforesaid, the Ombudsman can also give written opinions as to his view, on the complaint and what is fair and just in the circumstances of each case.

Does it cost me anything to complain?

There is no charge or fee to submit a complaint to the Ombudsman. The Rules or the Ombudsman Scheme provides for a fee of Rs. 250/=. This fee of Rs. 250/= was levied to prevent frivolous complaints. However, now no fee need be paid or submitted with the complaint but the Ombudsman will reject and not inquire into any frivolous vexatious complaints.

Which current legislations are available related to insurance in Sri Lanka?

The following are the current legislation relating to insurance in Sri Lanka.

  1. Insurance Corporation Act no. 2 of 1961
  2. Control of Insurance Act No. 25 of 1962
  3. Control of Insurance (Amendment) Act No. 9 of 1967
  4. Insurance (Special Provisions) Act No. 22 of 1979
  5. Control of Insurance (Amendment) Act No. 42 of 1986
  6. Insurance Corporation (Amendment) Act No. 43 of 1986
  7. Insurance (Special Provisions) (Amendment) Act No. 44 of 1986
  8. Control of Insurance (Miscellaneous Provisions) Regulations, 1987
  9. Regulation of Insurance Industry Act No. 43 of 2000
  10. Sri Lanka Export Credit Insurance Corporation Act No. 15 of 1978
  11. Social Security Board Act No. 17 of 1996
  12. Agricultural and Agrarian Insurance Act No. 20 of 1999

The IRCSL has recently published a Manual containing all the legislation and regulations governing Insurance in Sri Lanka as at June 2006. This publication is available for purchase at the IRCSL.