Full Text
REGD. No. D. L.-33004/99
The Gazette of India
C.G.D.L.-E.-25112025-267956
EXTRAORDINARY
PART II—Section 3—Sub-section (i)
PUBLISHED BY AUTHORITY
No.778]
NEW DELHI, TUESDAY, NOVEMBER 25, 2025/AGRAHAYANA 4, 1947
13
MINISTRY OF FINANCE
(Department of Financial Services)
NOTIFICATION
New Delhi, the 25th November, 2025
G.S.R. 864(E).—Draft rules to amend the Insurance Ombudsman Rules, 2017, which the Central Government
proposes to make in exercise of the powers conferred by section 24 of the Insurance Regulatory and Development
Authority Act, 1999 (41 of 1999), are hereby published for information of all persons likely to be affected thereby, and
notice is hereby given that the said draft rules will be taken for publication in Gazette of India after the expiry of a period
of forty-five days from the date on which the copies of the draft rules are made available to the public.
Objections or suggestions, if any, from the persons likely to be affected may be addressed to the Secretary,
Ministry of Finance, Department of Financial Services, Jeevan Deep Building, 3rd floor, Sansad Marg,
New Delhi – 110 001.
Objections or suggestions that may be received from persons likely to be affected with respect to the draft
rules within the aforesaid period shall be considered by the Central Government.
Draft Rules
1. Short title and commencement:
(1) These rules may be called the Insurance Ombudsman (Amendment) Rules, 2025.
(2) They shall come into force from the date of their publication in the Official Gazette.
2. In the Insurance Ombudsman Rules, 2017 (hereinafter referred to as the said rules), for the word "Ombudsman", the
word "Insurance Ombudsman" shall be substituted, wherever they occur.
3. In the said rules, in rule 2, after the word "complaints" the words "made under rules 13 and 14 of these Rules for
policies" shall be inserted.
4. In the said rules, in rule 3, the words "agents and intermediaries" shall be substituted by the words "agents,
intermediaries and insurance brokers".
5. In the said rules, in rule 4, -
(a) in sub rule (1), after the clause (a), the following sub-clauses shall be inserted, namely: -
1. In Hindi, “बीमा लोकपाल नियम, 2017” shall be referred to as “इन्शुरन्स ओम्बड्समैन नियम, 2017” and the
words “बीमा लोकपाल” shall be substituted by the words "इन्शुरन्स ओम्बड्समैन", wherever they occur and the
words “बीमा लोकपाल परिषद्” shall be substituted by the words “कॉउन्सिल फॉर इन्शुरन्स ओम्बड्समैन”, wherever
they occur.
(aa) "Appellate Authority (AA)" shall mean an Appellate Authority constituted by Insurance Regulatory and
Development Authority of India under rule 17A.
(aaa) "Authority" means the Insurance Regulatory and Development Authority of India (IRDAI) established
under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of
1999);
(b) in sub rule (1), in clause (e), the words "the Insurance Ombudsman appointed under rule 7" shall be
substituted by the words "a person appointed as an Insurance Ombudsman under rule 7 of these rules";
(c) in sub rule (1), clause (g) shall be omitted;
(d) in sub rule (1), in clause (i), after the word "single contract" the words ",including Government Schemes
being implemented through insurance companies" shall be inserted.
(e) in sub rule (2), the words "Insurance Act, 1938 and the Insurance Regulatory and Development Authority
Act, 1999" shall be substituted by the words "Insurance Act, 1938, the Insurance Regulatory and
Development Authority Act, 1999 and the Rules or Regulations made thereunder.
6. In the said rules, in rule 5, -
(a) in sub rule (1), the word "an" shall be substituted by the word "a".
(b) in sub rule (2), for clause (vi), the following clause shall be substituted, namely: —
“(vi) the Chief Executive Officer & Managing Director (CEO&MD), Life Insurance Corporation of
India (LIC of India) established under the Life Insurance Corporation Act, 1956 (31 of 1956); and"
(c) in sub rule (2), after clause (vi), the following clause shall be inserted, namely: —
"(vii) the Chairman, General Insurers“ (Public Sector) Association of India (GIPSA)”.
(d) in sub rule (3), the word "Chairman of the LIC of India" shall be substituted by the words "CEO&MD
of LIC of India".
(e) in the proviso to sub rule (6), the words, brackets and figures “clauses (iv), (v) and (vi)" shall be
substituted by the words brackets and figures “clauses (iv), (v), (vi) and (vii)".
7. In the said rules, in rule 6, -
(a) for sub-rule (2), the following sub-rule shall be substituted, namely: —
"(2) The Council for Insurance Ombudsmen shall appoint Insurance Ombudsman as per Rule 7. In
case any vacancy arises in any Insurance Ombudsman due to resignation or retirement or death of the
Insurance Ombudsman, the Council for Insurance Ombudsmen shall direct an Insurance Ombudsman
of such other territorial jurisdiction to hold additional charge of the Insurance Ombudsman where
such vacancy may arise. The Council for Insurance Ombudsmen may consider the request for change
in place of posting of Insurance Ombudsman, as per rule 8 (2)".
(b) in sub rule (3), the words "the assistance of outside" shall be substituted by the word "external".
8. In the said rules, in rule 7, -
(a) in sub rule (1), after the words "such number of Insurance Ombudsman" the words "in accordance with
rule 11," shall be inserted.
(b) in sub rule (4), after the words "including any vacancy likely to arise in that calendar year" the words
"saving those vacancies for which selection process has been completed and the selected Insurance
Ombudsman is expected to join" shall be inserted.
9. In the said rules, in rule 7A, -
(a) the marginal heading shall be substituted with the following, namely: —
"7A. Eligibility Criteria for appointment of Insurance Ombudsman. - A person shall be eligible for
selection as Insurance Ombudsman, if he—
(b) in clause (i), the word “but” after the words "fifty-five years" shall be substituted by the word "and" and
after the word “advertisement;" the word "and" shall be inserted
(c) for clause (iii), the following clause shall be substituted, namely: —
"(iii) has served for at least twenty-five years in the insurance industry and has held a post not lower
than one level below that of a director on the board of an Insurance company or has served IRDAI not
below the level of Executive Director".
10. In the said rules, in rule 7B, -
(a) in proviso to sub rule (1) the words "the shortlist" shall be substituted by the words "such list".
(b) for explanation,
(i) in clause (i), the word "and" shall be deleted
(ii) for clause (ii), the following clause shall be substituted, namely: —
"(ii) who has served in the insurance industry, shall be reckoned from the date of his first appointment
to a position either immediately below the level of a director on the board of an insurance company
or at the level of a director on the board, whichever is earlier; and"
(iii) after clause (ii), the following clause shall be inserted, namely: —
"(iii) who has served in the IRDAI, shall be reckoned from the date of his first appointment to the
position of Executive Director”.
(c) in clause (a) to sub rule (2), the following clause shall be substituted, namely: —
"(a) a declaration and undertaking that he shall ensure that there is no conflict of interest in the discharge of
functions and duties of Insurance Ombudsman; and
(d) in sub rule (5) and (6), the words "shortlist", wherever they occur, shall be substituted by the word "list".
(e) in sub rule (6), the words "Directorate of Enforcement, Revenue Intelligence and Goods and Service Tax
Intelligence" shall be substituted by the words "Directorates of Enforcement, Revenue Intelligence, Goods and
Service Tax Intelligence".
(f) for sub rule (7), the following sub-rule shall be substituted, namely: —
"(7) The selection committee shall, after giving an opportunity for interaction to all the candidates
shortlisted by it under sub-rule (4), recommend to the Council for Insurance Ombudsmen a candidate
for appointment against each vacancy in the office of Insurance Ombudsman, along with up to two
additional candidates in order of preference as reserve candidates. The recommended list of
candidates, including reserve candidates, will be valid for a period of 12 months from the date of final
recommendation".
(g) for proviso to sub rule (9), the following proviso shall be substituted, namely: —
"Provided that if the selected candidate for appointment does not assume office within 90 days of
offer or 60 days of the vacancy, whichever is later, or, after assuming office at any time during the
validity of the list of candidates referred to in sub-rule (7), either resigns or is removed therefrom, or
dies, then the Council for Insurance Ombudsmen may appoint the reserve candidate, in accordance
with the order of preference, after ascertaining his willingness".
11. In the said rules, in rule 8, -
(a) rule 8 shall be serially numbered.
(b) in newly numbered sub rule (1), after the word "reappointment" the words "as Insurance Ombudsman"
shall be inserted.
(c) first Proviso to the newly numbered sub rule (1) shall be omitted.
(d) for the second proviso to the newly numbered sub rule (1), the following proviso shall be substituted,
namely: —
"Provided that Insurance Ombudsman may resign by giving prior notice, in writing, of not less than
ninety days, or three months' salary in lieu thereof, to the Council for Insurance Ombudsmen,
informing his intention to resign; in case the last date of notice period falls on Saturday or Sunday or
holiday, the Insurance Ombudsman shall be relieved on the next working day".
(e) in the third proviso to the newly numbered sub rule (1), the word "also" shall be substituted by the word
"further" and the word "period" shall be inserted after the word "notice".
(f) after sub rule (1), the following sub rule (2) shall be inserted: —
"(2) Insurance Ombudsman may, once during his tenure, make a request in writing to Council of
Insurance Ombudsmen for change of place of posting for remainder of his term giving reasons thereof:
Provided that the Council of Insurance Ombudsmen shall not entertain such request if:
i there is no vacancy at requested place; or
ii. the list of reserve candidates for the said place has not lapsed; or
iii. the vacancy for the said place has already been advertised.
Provided further that the decision of Council of Insurance Ombudsmen shall be final and binding".
12. In the said rules, in rule 11, -
(a) in sub rule (1), the following sub-rule shall be substituted, namely: —
"(1) The office of the Insurance Ombudsman shall be located in each State Capital and UT and at such other
places and shall have such territorial jurisdiction as may be specified by the Council for Insurance
Ombudsman from time to time."
(b) for sub rule (2), the following sub-rule shall be substituted, namely: —
"(2) The Council of Insurance Ombudsmen, considering the relative workload of each Insurance
Ombudsman, may allot online complaints to any Insurance Ombudsman”.
(c) in sub rule (4), the words "so to do” shall be substituted by the words "to do so".
13. In the said rules, in rule 12, -
(a) for the marginal heading the following shall be substituted, namely: —
"12. Offices of Council for Insurance Ombudsmen, Insurance Ombudsman and Appellate Authority".
(b) in sub rule (1), the words “shall make available to the Insurance Ombudsman", shall be substituted by
the words "shall make available to the Appellate Authority and Insurance Ombudsman".
(c) for sub rule (2), the following sub-rule shall be substituted, namely: —
"(2) The salary, allowances and perquisites payable to the members of the Appellate Authority,
Insurance Ombudsmen, staff of the Insurance Ombudsman and Appellate Authority secretariat and
all expenses incurred in connection with administration, including expenses to be incurred by the
Council for Insurance Ombudsmen, fees of professional experts engaged under sub-rule (3) of rule 15
and expenses towards Advisory committee constituted under rule 19 shall be borne by the Insurance
Councils in such proportion as the Council for Insurance Ombudsmen may, by a general or special
order specify, from time to time, in this behalf."
Provided that while calling for funds, the Council for Insurance Ombudsmen shall also, in addition to any other
factors as it may deem fit, consider the number of awards:
(a) passed by the Insurance Ombudsman against the insurer; and
(b) not complied by the insurer within the prescribed timelines.
(d) for sub rule (3), the following sub-rule shall be substituted, namely: —
"(3) Each bench of Appellate Authority and Insurance Ombudsman shall submit its annual budget
requirements for the ensuing financial year by the 31st January every year to the Council for Insurance
Ombudsmen and the Council for Insurance Ombudsmen shall, after finalising the budget in
consultation with the respective benches of Appellate Authority, and Insurance Ombudsman, advise
the Insurance Councils to allocate to it the funds including funds for the budgeted expenses of the
Council for Insurance Ombudsmen, and Council for Insurance Ombudsmen shall in turn allocate
funds to the respective offices of the Appellate Authority and Insurance Ombudsman".
(e) in sub rule (4), the words "office of Insurance Ombudsman", shall be substituted by the words "Office of
Appellate Authority and Insurance Ombudsman”.
14. In the said rules, in rule 13, -
(a) in sub rule (1), the word "performance" shall be substituted by the word "service".
(b) in clause (a), sub rule (1), the words "the life insurer, General Insurer or the health insurer" shall be
substituted by the words "an insurance company".
(c) for sub rule (2), the following sub-rule shall be substituted, namely: —
"(2) The Insurance Ombudsman shall act as counsellor and mediator relating to matters specified in
sub-rule (1) provided there is consent of the parties to the dispute – either in writing or recorded
electronically through the online platform under sub-rule 6 of Rule 14".
(d) in sub rule (4), the words "as the case may be", after the words "Government or”, shall be deleted.
(e) after sub rule (4), the following sub rules (5) and (6) are inserted, namely:
"(5) The Insurance Ombudsman shall consider complaints for settling through mediation or passing
an award as per rules 16 and 17".
"(6) The Insurance Ombudsman may recommend to the Authority, imposition of a penalty against
insurer(s) or insurance broker(s), where he is of the opinion that the said insurer or insurance broker
has repeatedly acted in a manner that is arbitrary, unjust or tantamount, to harassment of
policyholder(s) or if the insurer or insurance broker is non-compliant of recommendation or awards
passed by Insurance Ombudsman".
15. In the said rules, in rule 14, -
(a) in sub clause (iii) of clause (b) of sub rule (3), the word "named" shall be deleted.
(b) for sub rule (6), the following sub-rule shall be substituted, namely: —
"(6) The Council for Insurance Ombudsmen shall develop a complaints management system, which
shall include an online platform developed for the purpose of online submission of complaint,
recording consent for mediation of complaint, uploading documents, tracking the status of complaints
made under rule 14 and to appeal against the award of Insurance Ombudsman under Rule 17A. The
platform may also provide the facility of Aadhaar enabled authentication, wherever required".
16. In the said rules, in rule 15, -
(a) in sub rule (1), the following proviso shall be inserted, namely: —
"Provided that the Office of Insurance Ombudsman shall register each and every complaint
immediately and within a period not exceeding one working day from the date of receipt of
complaint".
(b) in sub rule (5), the following proviso shall be inserted, namely: —
"Provided that the Insurance Ombudsman may allow the insurer (including its agents and
intermediaries) or insurance broker, as the case may be, to be heard through video- conference”.
17. In the said rules, in rule 16, -
(a) in sub rule (1), after the word “recommendation", the words ",subject to the limit specified in rule 17(3),
which he" and after the words "mutual written" the word "/digital" shall be inserted and the following
proviso shall also be inserted, namely:
"Provided that the Insurance Ombudsman shall seek all the desired documents from the complainant
and/or insurer or broker, before making an appropriate recommendation in clear terms without any
subjectivity".
(b) in sub rule (2), after the word “in writing” the words “or through digital means” shall be inserted and the
following proviso shall be inserted, namely:
"Provided that in case of non-receipt of the acceptance from complainant within the stipulated time,
the Insurance Ombudsman shall proceed with passing an award under Rule 17”.
(c) for sub rule (3), the following sub-rule shall be substituted, namely:
"(3) The Insurance Ombudsman shall send to the insurer, or insurance broker, as the case may be, a
copy of its recommendations, along with the acceptance letter received from the complainant for
compliance immediately but not later than fifteen days of the receipt of such recommendations. The
insurer or insurance broker, as the case may be would inform the Insurance Ombudsman of the
compliance and upload the details thereof on the Complaints Management System:
Provided that in case of non-compliance of recommendation of the Insurance Ombudsman by the
insurer / insurance broker within the timeline specified above, the complainant may approach the
Insurance Ombudsman for passing an award under Rule 17".
18. In the said rules, in rule 17, -
(a) for proviso to sub rule (3), the following proviso shall be substituted, namely:
"Provided that the Insurance Ombudsman shall not award compensation in excess of -
(i) the loss suffered by the complainant as a direct consequence of the cause of action, subject to
maximum sums payable under the policy including bonus, interest etc., as per the policy terms and
conditions;
Provided that in case of any undue hardship faced by the complainant due to unjust, arbitrary or
malafide action of the insurer/insurance broker, Insurance Ombudsman may also, for reasons to be
recorded in writing, impose a penalty on such insurer/insurance broker, payable to the complainant,
up to a sum of:
(i) 100% of the amount of award, subject to maximum of Rs 20 lakh for consequential
loss; and/or
(ii) Rs 1 lakh for mental harassment.
(b) in sub rule (5), the words "named in the complaint" after the word “may be" shall be deleted.
(c) in sub rule (6), after the word "Complaint Management System", the words "of Council for Insurance
Ombudsman" shall be inserted.
(d) in sub rule (7), after the words “such interest,", the words "payable by the insurer," shall be inserted.
(e) for sub rule (8), the following sub-rule shall be substituted, namely:
"(8) The award of Insurance Ombudsman shall be binding on the insurers or insurance broker, as the
case may be, unless appealed against, and in case of non-compliance of award within the timeline
specified in sub-rule (6), a penalty as specified by Authority shall be payable by insurer or insurance
broker to the complainant, in addition to interest mentioned under sub-rule (7)”.
19. In the said rules, after rule 17, the following sub-rule 17A shall be inserted, namely:
17A. Appellate Authority. –
There shall be an Appellate Authority to be constituted by IRDAI, immediately, but not later than six
months from the date of publication of these rules to entertain any appeal made against the award
passed by Insurance Ombudsman under Rule 17 of these rules and which shall consist of two members
including one domain expert, to be decided by IRDAI.
IRDAI may also set up multiple benches of the Appellate Authority on such locations as decided by
the Authority.
(1) Procedure and Selection Criteria for Appointment
i. The eligibility criteria/ qualification of the members of the Appellate Authority would be the
same as prescribed in rule 7(A).
ii. IRDAI will invite for applications from eligible candidates as and when required, complete the
selection process, and appoint members to the Appellate Authority bench(es).
iii. The pre-appointment formalities for members of the Appellate Authority shall be same as that
of Insurance Ombudsman as per rule 7B (2), (5), & (6), and shall be completed by IRDAI.
iv. A member of the Appellate Authority would have a tenure of three years and shall not be eligible
for re-appointment.
v. The remuneration and allowances of the members of the Appellate Authority shall be same as
that of Insurance Ombudsman, as per rule 10.
(2) Appeals
i. The appeal can be made by either party within 30 days of the receipt of the award of Insurance
Ombudsman:
Provided that -
ii. On receipt of appeal against the award of Insurance Ombudsman, the Appellate Authority shall
call for all the relevant documents from the concerned Insurance Ombudsman for disposal of
the appeal.
The Appellate Authority may entertain appeals against the awards passed by the Insurance
Ombudsman through Video-Conferencing (VC) mode:
Provided that the complainant shall not be denied the opportunity to join through VC from the
nearest Office of Insurance Ombudsman, in case complainant so requests.
iii. Appellate Authority may, after due consideration of the facts of the case presented before it, -
a. dismiss the appeal; or
b. allow the appeal and set aside the Award of the Insurance Ombudsman; or
c. modify the Award of the Insurance Ombudsman and pass such directions as may be
necessary to give effect to the Award of the Insurance Ombudsman or Award so
modified; or
d. pass any other order as it may deem fit.
iv. The Appellate Authority shall pass an order within a period of three months of the receipt of
the appeal.
(3) The order of Appellate Authority shall have same effect as the award passed by Insurance Ombudsman
under Rule 17.
(4) Removal from office of Appellate Authority. A member of the Appellate Authority may be removed from
office on the ground of gross misconduct during his term of office, or physical incapacity, or unsoundness of
mind, or insolvency, or conviction for an offence involving moral turpitude, or engagement in any other paid
employment, or conflict of interest or furnishing as part of the selection process information that is false or
omits to specify material facts, after following due procedure specified as under, namely:-
(a) The IRDAI shall draw up articles of charge or charges, if any, on the member of Appellate
Authority after giving him a reasonable opportunity of being heard;
(b) IRDAI shall, as and when deemed necessary, appoint Executive Director level officer to inquire
into the allegations levelled against the member of Appellate Authority;
(c) Upon conclusion of the inquiry, IRDAI or the person nominated by it shall forward the inquiry
report to the concerned member of the Appellate Authority who shall submit his comments or
submissions within a specified time;
(d) Based on the material on record, the Authority shall decide, with reasons to be recorded in
writing, the action to be taken, if any, against the concerned member of the Appellate Authority.
(e) The decision of IRDAI shall be final in the matter.
20. In the said rules, in rule 18, -
(a) in sub rule (1), the date “30th June” shall be substituted by "15th May".
(b) in sub rule (2), the words "any time after the 30th June but not later than the 30th September every year."
shall be substituted with the words "not later than 30th June, every year".
21. In the said rules, rule 19 shall be substituted by the following, namely:
"19. Advisory Committee. (1) An Advisory Committee consisting of eminent persons not exceeding five
and including one Central Government nominee, nominated by the Ministry of Finance, Department of
Financial Services, shall be constituted by the Authority to review the performance of the Insurance
Ombudsman & Appellate Authority from time to time".
22. In the said rules, in rule 20, the following proviso shall be inserted, namely:
"Provided that the Central Government may suo moto amend these rules".
[F. No. S-14011/01/2025-Ins.I]
PARSHANT KUMAR GOYAL, Jt. Secy.
Note: The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), dated
the 27th April, 2017, vide G.S.R. 413 (E), dated the 25th April, 2017 and were subsequently amended vide
G.S.R. 785(E) dated the 17th August, 2018 (published on 20th August, 2018), G.S.R. 147(E) dated the 2nd March,
2021, G.S.R. 334(E) dated the 18th May, 2021 and lastly vide G.S.R. 828(E) dated the 9th November, 2023.
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.
Digitally signed by AMIT KUMAR
AMIT KUMAR JAISWAL JAISWAL
Date: 2025.11.25 22:17:38 +05'30'