Regulator IRDAI today directed general insurance companies not to use coercion or force to obtain discharge vouchers or receipts of settlement of claims, from insured persons.
A discharge voucher represents culmination of insurance claim, which is evidence of payment.
Wherever there are no disputes by the insured/s or claimant/s to the amount offered by the insurer towards settlement of a claim, the present system of obtaining the discharge voucher may be continued, IRDAI said.
The insurers must ensure that the vouchers collected are dated and complete in all respects while obtaining the signature/s of the insured persons or claimant(s).
In case the amount offered is disputed by the insured or claimant, insurers “would take steps to pay the amount assessed without waiting for the voucher discharged” by the insured/s or claimant/s, the Insurance Regulatory and Development Authority of India (IRDAI) said.
However, “under no circumstances the Discharge vouchers shall be collected under duress, by coercion, by force or compulsion,” the regulator said.
Insurers, on various occasions, had submitted that a circular of September 2015 is not in the line with the IRDA (protection of policyholders interests) Regulations, 2002 (PPI Regulations) and the Indian Contract Act.
IRDAI reviewed the matter taking in to consideration the provisions of the Contract Act, PPI Regulations and Apex Court Judgements.
It said the directions to general insurance companies including stand-alone health insurers and specialised insurance companies have been issued after taking equal cognisance of the legal rights of the policy holders and insurers.