Tuesday, March 2, 2010

MY LORD, THAT'S THE PRACTICE!

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Service Story: "My LIC days!"
by
PG.POOCHERY
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It was her humble submission that "insurance companies the world over do not disclose reasons for refusal of insurance".
It is a fact that they do canvass people for insurance. They grant insurance. When however they refuse to give insurance, they do not disclose their reasons.
But the Ombudsman was not convinced. He asked: "Why?"
Lady officer who represented the insurance company repeated her answer. " Sir, we don't disclose reasons".
"Why?"
"Sir, that is the practice!" This time she asserted with all the emphasis at her command.
But the Ombudsman ordered that the reason for refusal of insurance must be disclosed to the person seeking insurance. Finally insurance office relented and the reason was communicated.
Permission for communicating the reason was conveyed by the head office of the company. But they instructed the local office to intimate the ombudsman that as a special case the reason was being intimated. In future the reason won't be disclosed.
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Again, why?
Nobody had the reason. But they knew that it can't be said.
But what is the reason?
Again the same old answer: it can't disclosed.
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Insurance companies collected many details from the applicant through the application for insurance. In addition they collected information from agents, doctors and others with the understanding that the same shall be kept as confidential. They are duty bound to keep this information as confidential. This is the reason why it is not disclosed.
Ombudsman should have been told that the company would be prepared to disclose the reasons to the ombudsman in a closed envelope but not to the applicant.  This is the usual practice in courts while dealing with confidential matters and such an argument would have been accepted by the Ombudsman also.  
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With the advent of institutions like ombudsman and consumer forums, the old method of refusing to act or to inform the customers is no more possible. These companies have to learn to invent new styles and exist.
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