Friday, January 17, 2014

Misinformation and Misselling in the name of IRDA by insurance companies

Was trying to buy a health insurance when the rep tried taking me for a ride in the name of IRDA - thankfully since I record all my phone conversations, I could report to IRDA (along with a cc to the insurance company). Will keep you posted if I hear anything.....


I am writing today to bring to your attention a case of gross misinformation and misselling in the name of IRDA which I came across yesterday and may point to a bigger problem on how insurance companies might be conducting themselves while selling products and settling claims. 

I was trying to purchase an individual health insurance product online on ApolloMunich website when I was forced to call them - as the insurance cover which I wanted to buy was not available online. This conversation happened on 15th Jan at around 11:21 am and left a very bad taste in my mouth, for it was a clear attempt to dupe me into buying a joint cover for me and my wife when I was looking to buy an individual cover for myself - and that too by quoting a fictional IRDA rule!! I have recorded this phone conversation (as a practice I record all my phone conversations and  had informed the ApolloMunich rep that I am recording this conversation) and sending it across for your listening pleasure - its about 13 min conversation with long pauses (when I was put on hold while rep consulted his manager) - you can listen to this conversation using a VLC player (its a .amr format). I would request you to listen to this recording till the end where the rep does a remarkable volte-face. 

To give you a gist of what happened, after taking my basic information and realizing that I am married, the rep informed me that as per IRDA rule, since I am married I cannot buy a standalone product but have to buy a cover for both myself and my wife (of course that means additional premium for the insurer). Very surprised by this information, when I confronted the rep, he consulted his manager and  came back saying that I can buy a standalone product provided I give an undertaking that my wife is already covered under another insurance product and hence, I would not be buying for her (since I had already told him that her employer provides health insurance) . Appalled at his audacity when I demanded to know the IRDA rule under which such condition was being imposed he initially refused to share information but when I threatened to file complaint with IRDA  and also demanded that I be connected to his manager (which did not happen - as per the rep, the manager was unable to come on phone) he finally relented that there is no such IRDA rule. 

While this may seem like a minor incident and perhaps a case of zealous hard-selling by a sales guy, I view this very seriously simply because IRDA's name was being thrown around so callously. When any insurance company quotes IRDA, a potential customer or a policyholder will take it as a given and not question the information being given and my worry is that companies may be taking undue advantage of this (as the recording shows). My bigger worry is if such misinformation is also being perpetrated at the time of claim settlement -thereby denying claimants of their rightful claims, for after this conversation my trust in insurance companies has been badly shaken.  

I am not sure if what happened with me was a case of a zealous rep trying to achieve his targets or an obsessive floor manager pushing his people hard or perhaps even a bigger wider problem. I am also not sure if this is a frequent problem faced by others - perhaps you would have better data points on that but clearly this incident shows how IRDA's good name can be misused and I hope that the regulator would take note of this and ensure some steps are taken to arrest such a malpractice (if it indeed is a wider problem). 

My apologies for spamming your mailboxes but this was something which I had to bring to your notice. 

Nishant Kashyap


Finally after two reminders and 23 days I get a highly bureaucratic response from IRDA...

Dear Sir/ Madam,
We acknowledge your mail.
As we found information to be incomplete to register your complaint, we request you to send
the complete details in the below mentioned format or you can contact 155255 (Toll Free) to
register the complaint.

Mandatory Fields

*Name of Complainant

Communication Details

*Door No./ Bldg/Name/ Floor

Street / Area





*Pin Code

E- Mail

Telephone No

*Mobile No

Fax No

*Insurance Type (Please mentioned Insurance Type  


* Non Life

*Insurance Company Name

*Date of Birth of Policy Holder

*Policy No:

Cover Note:

Other Reference No:

Policy serving Brach Code/Address

*Details of the Complaint (Please type the full details of the complaint)

*Have you Approached Insurance Company Regarding This Grievance (If Yes Provide Ref No )

Consumer Affairs Department

"Caution against spurious calls and fictitious offers - IRDA does not involve, directly or through any 
representative, in sale of any kind of insurance or financial products. IRDA does not announce any 
bonus for policyholders or insurers. Any person making any kind of transaction with such 
individuals/agents will be doing the same at his / her own risk."

"This mail may contain confidential or proprietary information intended only for the use of the addressee(s) named above or may contain information that is legally privileged. If you are not the intended addressee, or the person responsible for delivering it to the intended addressee, you are hereby notified that reading, disseminating, distributing or copying this mail is strictly prohibited. If you have received this mail by mistake, please immediately notify us by replying to the mail and delete the original mail and any copies immediately thereafter.’Caution: “The Insurance Regulatory & Development Authority is the Regulator for the insurance sector and does not carry out any prospecting or sales. Please do not respond to such offers however official or attractive they may look. These are spurious offers/calls. 


My response below (BTW ppl as far as insurance is concerned you are on your own..I expected IRDA to be incensed and quick to take action...but I was very disappointed with their total lack of interest)


When I had sent my initial email to IRDA along with the call recording, I was seething with anger on a blatant attempt by a reputed insurance company to dupe a customer and that too by misquoting the regulator (ie IRDA). More importantly, I was pretty sure that when the regulator (ie you) will hear the content of the call - which by the way is indisputable as the rep gives his name and ID very clearly and the audio quality is also very clear - you would be much more angrier and there would be immediate action as this is a clear case of attempted fraud and misrepresentation. I was hoping that IRDA would take immediate cognizance of the issue - which I firmly believe is much more wide-spread than the current company in question and would  ensure that companies stop taking its customers for a ride in this manner. However, I must say that I am very disappointed by your lukewarm response. First of all there is no acknowledgement of whether you had received my email or not - when this was something I expected you to immediate clamp down on. Then after I send two reminders, all I get back from you (and that too after 23 days) is that I have not filed my complaint in the provided format??? I have very clearly communicated in my first email that I wanted to get your attention to a bigger problem which is much more than just a grievance on a specific issue with a specific company - it is a wider problem where IRDA name is being misused by companies and fraudsters alike and it is painful to see that rather than taking strict and prompt action - all we are worried about is the red tape - whether the complaint was filed in the right format or not? Kindly look at the form that you had sent out - how is this even relevant to my complaint - this form is for policyholders while I faced an issue during the purchase of the policy.  As an educated law abiding citizen who trusts his authorities to do the right thing, I sought to bring to your attention a malaise but honestly your slow and indifferent response has shaken my trust to the core. No wonder, insurance companies and fraudsters think they can do anything and get away with it! Insurance is one of the basic needs of modern living which has been long ignored in developing countries like ours - while it is heartening to see so much of action thanks to IRDA in recent years - pls understand that if you let these rogues get away - it will only create mistrust among consumers which in the long term would severally impact the growth of the sector - pls do not let this happen. BTW I have another call recording which I got from someone claiming to be from IRDA verification department - I wanted to share that as well - but seeing your tepid response I am not any longer sure that bringing such issues to your attention is worth it!

A very disappointed citizen,
Nishant Kashyap

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