Home/ News / India/  Selling life insurance policies? You may be under NCDRC radar. Here’s why

The Insurance Regulatory and Development Authority of India (IRDAI) has been directed to look into the role of insurance agents selling life insurance policies. The National Consumer Disputes Redressal Commission (NCDRC) has asked the insurance regulator to issue new guidelines on the conduct and responsibilities of the insurance agent.

IRDAI has been asked to issue fresh guidelines and also modify proposal forms of the insurance policies so that customers will be aware of non-disclosure of medical conditions could lead to repudiation. A bench comprising of Dr. S M Kantikar and member Binoy Kumar expect the move to avoid unnecessary mental agony and expenses of the insured.

The decision comes after an appeal filed by HDFC Standard Life Insurance Company before NCDRC. The life insurer had challenged an order of the state consumer disputes redressal commission in Jaipur which had ruled in favour of the consumer.

The apex consumer commission notes that suppression of facts in the proposal form in the above case had vitiated the case of the complainant.

NCDRC said, "The appeal is allowed and the order of the state commission is set aside. We also advise the Insurance Regulatory and Development Authority of India (IRDAI) to issue fresh guidelines on the conduct and responsibilities of the insurance agent when dealing with a life insurance policy on the need for full disclosure of all diseases suffered by the customer in the proposal form and implications of non-disclosure. The proposal form can also be suitably modified to this effect," reported PTI.

In this case, it was observed that the deceased had got the life insurance policy from the company by concealing the material information regarding his medical ailments from which he was suffering since 2008.

It was argued by the counsel of the respondent/complainant that the insurance company failed to prove the cited illness played a causal role in the death of the policyholder and thereby there was no ground to repudiate the claim. The complainant blamed the agent of the insurance company, alleging that he was misled while filling up the proposal form and that he signed on the dotted lines in good faith.

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Updated: 12 Jun 2022, 04:25 PM IST
Recommended For You
Get alerts on WhatsApp
Set Preferences My Reads Watchlist Feedback Redeem a Gift Card Logout