The Securities and Exchange Commission of Pakistan (SECP) has clearly defined jurisdiction, functions and powers of Insurance Ombudsman, who would be empowered to investigate matters pertaining to the insurance companies under draft Insurance Bill 2016.
According to the draft of the Insurance Bill 2016 issued by the SECP, Insurance Ombudsman may on a complaint by any aggrieved person undertake any investigation into any allegation of the following on the part of any insurance company: Mal-administration; any partial or total repudiation of claims by the insurance companies; dispute with regard to premium paid or payable in terms of the policy; dispute on the legal construction of the policy wordings in case such dispute relates to claims; delay in settlement of claims; and non-issuance of any insurance document to customers after receipt of premium.
The said six areas of investigations by the Ombudsman against the insurance companies have been elaborated in the draft Insurance Bill 2016, sources said.
The proposed section 189 of the draft Bill has empowered the Insurance Ombudsman to investigate cases of mal-administration, dispute with regard to premium paid or payable in terms of the policy; dispute on the legal construction of the policy wordings in case such dispute relates to claims; delay in settlement of claims and non-issuance of any insurance document to customers after receipt of premium etc, sources added.
Provided that the Insurance Ombudsman shall not have any jurisdiction to investigate or inquire into any matters which is sub-judice before a court of competent jurisdiction or tribunal or board in Pakistan on the date of the receipt of a complaint, reference or motion by him.
For the purposes of this section "mal-administration" includes a decision, process, recommendation, act of omission or commission which is contrary to law, rules or regulations or is a departure from established practice or procedure, unless it is bona fide and for valid reasons; or is perverse, arbitrary or unreasonable, unjust, biased, oppressive, or discriminatory; or is based on irrelevant grounds; or involves the exercise of powers, or the failure or refusal to do so, for corrupt or improper motives, such as, bribery, jobbery, favouritism, nepotism and administrative excesses; and corruption, nepotism, neglect, inattention, inordinate delay, incompetence, inefficiency and ineptitude in the administration or discharge of duties and responsibilities, it said.
Under draft Insurance Bill 2016, President shall appoint an Insurance Ombudsman entrusted to discharge the functions vested upon him through the law. The Insurance Ombudsman shall be a natural person having high integrity and ability and unimpeachable insurance or legal credentials, and shall not at the date of his appointment be more than sixty five years of age. He shall not be a shareholder of an insurance company.
The Insurance Ombudsman shall hold office for a period of four years from the date of his appointment unless he resigns earlier in writing under his hand addressed to the President, or is disqualified or removed in accordance with law. He shall not be eligible for any extension of tenure or for reappointment under any circumstances whatsoever.
Provided that the Insurance Ombudsman shall continue to hold office after expiry of his tenure till his successor enters upon the office. Provided further that if at any time when the office of the Insurance Ombudsman is vacant or he is unable to perform his functions due to any cause, the President shall appoint an Acting Insurance Ombudsman who shall perform functions and exercise powers as are vested in the Insurance Ombudsman and shall be entitled to all privileges as are admissible to the Insurance Ombudsman. However, till such time the Acting Insurance Ombudsman is appointed, the Wafaqi Mohtasib (Ombudsman) shall act as Insurance Ombudsman of the concerned office and in case the Wafaqi Mohtasib is absent or unable to perform functions of his office, the Federal Tax Ombudsman shall act as Insurance Ombudsman, it added.