Insurance Mis Selling – Types and Reasons
Insurance Industry faces a major challenge of insurance mis-selling. These mis selling are of
two types:
Types of Insurance Mis-selling
Insurance not matching with the needs of customer
Insurance being sold on exaggerated promises
There are various reasons of such large instances of mis selling, few are given below:
Distribution Model of Insurance Industry. Agents target their natural market.
Banks push it as a bundled product along with other benefits of banking services.
Brokers pushing the product as experts.
Financial literacy is poor, customers do not do basic research and buy on impulse.
Customers are not reading the terms and conditions and sign on the dotted line.
Common reasons of mis selling of insurance policies in India:
Selling insurance by giving false information.
Selling regular premium policy as single premium or flexible premium.
Selling high premium policy without realizing future money commitment.
Forging the proposal form and giving wrong information.
Selling Insurance Policy when a customer is asking for Fixed Deposit.
Churning the existing policy and replacing with new for new commission.
Selling Insurance Policy by promising extra bonus, gold coin.
Selling Insurance as pre pre-condition for opening an ATM/Telecom Tower.
Bundling Free Health Insurance with Life Insurance.
Selling ULIPS without explaining the concept.
Insurance Samadhan
At Insurance Samadhan, we find solutions to any insurance-related issue that include lapsed insurance policy, assistance in case settlement, claim recovery in case of insurance fraud, assistance to NRI's in servicing their policies, and much more.
R 104 Basement, Greater Kailash 1, New Delhi, 110048
844-844-0626
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