Reduced misselling by Life Insurers results in complaint cuts by 40%

By reducing the instance of mis-selling, the life insurance industry has brought down the number of complaints by 40% to 1.22 lakh in 2016-17 from 2 lakh in 2015-16. The industry also brought down pending complaints to 247 this year from 935 last year, data from the insurance regulator showed. Though in ground people feel that there is no change in status in fraudulent misselling by life insurance companies. The general insurance industry – which handles portfolios such as motor, health, fire, marine cargo -saw complaints drop 11% to 52,908 this year, from 59,083 last year. Overall the insurance industry witnessed a 34% decline in complaints to 1.72 lakh from 2.63 lakh in the year-ago period. The consumer affairs booklet released by IRDAI also talked about free-look cancellations, which increased by 43% to 5,083 from 3,551. The free-look gives consumers the option to change their mind and cancel the policy within 15 days of purchase. The 17 ombudsman centres spread across the country received 27,627 complaints this year. While 16,744 complaints (about 60%) pertain to life insurers, the remaining 10,883 complaints (about 40%) were linked to general insurers. This was in addition to 2,693 complaints pending with various offices of ombudsmen at end of March 2016. “We don’t immediately take punitive action against insurance agents such as reducing their commission. But we try to have positive reinforcement, counselling, so that agents understand issues from the customer’s point. We constantly monitor sales to see if this has been a pattern with that agent”, said Puneet Sahni, Head-Health, SBI General Insurance.