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Narayanan (individual)     16 October 2023

Misselling by life insurance company


I was conned by HDFC Life to take a pension policy with assurance of money doubling to 230% after vesting period 10 years and then showing in the document only 130% accumulation at vesting.  Despite this outright cheating, I continued to pay premium for 5 years and made the policy paid-up with reduced benefits.  Insurer pestered me each day to continue paying premium till vesting.  I refused.  Then they asked me to go to service branch and sign papers to confirm paid-up status.  I went to branch and was conned by a financial consultant that paid-up policy benefits would be less to me in face of diminishing annuity rate each year, asked me to take a new product at current annuity rate, with annual guaranteed addition, by way of surrendering the paid-up policy.  I did so on the face of illustration provided.  When I received document, I realized it was again a clever cheating by them.  It said the guaranteed addition is only in the event of death of policy holder.  I requested free-look cancellation as per policy wording, within 2 days of receiving document.  They accepted initially but dragged on the process till free-look period of 30 days was over, and then refused to cancel stating request received beyond free-look period and various other irrelevant reasons.  Now it is going to be 2 years in 3 more days.  Any legal remedy possible to get back my money?  Is there any time window for filing a consumer case against insurer?  Please advise.

I went to ombudsman court and the ruling was in favor of insurer.  However, the judge suggested to take an alternate product with immediate annuity, which also was refused by insurer.

Thanks and Regards,





 3 Replies

Sudhir Kumar, Advocate (Advocate)     16 October 2023

basically this does not appear to be a case o cheating.  Your blog does not show anything misrepresentation by anyone.  Probably you have entered into a contract without examining the same.


whole papers need to be seen for coming a c conclusion whether any legal action is feasible or not.  Kindly meet a lawyer .

Dr. J C Vashista (Advocate )     16 October 2023

Show relevant documents to a local prudent lawyer for proper opinion, advise and necessary proceeding.

LCI Thought Leader Rajesh Tandon ( Col (Retd))     06 December 2023

Dear Querist,

1. Insurance fraud occurs when someone intentionally deceives an insurance company, agent, adjuster, or consumer with the aim of obtaining an unlawful financial benefit. This fraudulent activity can happen at various stages, such as when purchasing, using, selling, or underwriting insurance.

2. If you wish to address a complaint against an insurance company, you can approach the Grievance Redressal Officer (GRO) of the insurance company. You have the option to either visit the nearest branch in person or send an email to the GRO. When contacting the GRO, it's crucial to submit your complaint in writing and provide the necessary supporting documents. Additionally, make sure to obtain a written acknowledgment of your complaint along with the date. In fact it is not clear from your narration of the query as to if you made any complaint in writing to concerned authorities and whether you have written acknowledgement or not ? Whether you have any record of reaching out to the concerned authorities in the form of email of which one can produce the record.

3. Here is the link of Insurance Regulatory and Development Authority of India wherein various names of the Insurers are given and against each is given grievance redressal system website link, email ID of Grievance Redresal officer (GRO) and Grievance Redressal Contact No,

4. Policyholders who have complaints against insurers are required to first approach the Complaints/Grievance Redressal Cell of the insurer concerned. If they do not receive a response from the insurer within a reasonable period of time or are dissatisfied with the response of the company, they may approach the Grievance Redressal Cell in the Policyholder's Protection & Grievance Redressal  Department of the IRDAI. Only complaints from the insured or the claimants shall be entertained. The cell does not entertain complaints written on behalf of policyholders by advocates or agents or by any third parties.

5. In addition, you can also plan escalating the level to ombudsman, the details of which are also given on the website of Insurance Regulatory and Development Authority of India i.e on this link

6. The well-settled law in the field of insurance is that contracts of insurance including the contracts of life assurance are contracts uberrima fides and every fact of materiality must be disclosed otherwise there is good ground for rescission. The  uberrimae fides is the foundation on which the insurance policy is instituted. The insurer and insured are under obligations to deal with the contracts of insurance with good faith and with good intention. formation of a contract of insurance. The assured and insurer are under obligation to make the declaration in relation to the facts of the assured. A declaration made by the assured while filling up the proposal form, and a declaration of the insurer while accepting the proposal and issuing of policy forms a part of the contract. Any suppression of information regarding the assets which is assured amounts to not declaring the facts. The important issues which emerge out of the judgement of Andhra Pradesh High Court in the case of LIC v Shakuntlabai is that the insurer cannot rely on insured’s signature to the declaration as a substitute for his duty of utmost good faith. The court held that the insurer did not establish by Clean and Cogent Evidence that the question was properly explained to the insured.

7. Therefore,  dear querist, by the narration of the facts of your case, it emerges that your case hinges around the doctrine of uberrima fides, wherein the facts of materiality seem not to have been disclosed to you by the insurer with good faith and with good intention. Accordingly, you should build up your case around this doctrine of uberrima fides to contest your case.

8. In addition, under  Sec 69(1) of the Consumer Protection Act 2019, the complaint has to be filed within two years from the date from which cause of action has arisen. Notwithstanding the same, there is a provision under Sec 69(2) of the Consumer Protection Act 2019, whereby a complaint may be entertained after the period specified in sub-section (1), if the complainant satisfies the District Commission, the State Commission or the National Commission, as the case may be, that he had sufficient cause for not filing the complaint within such period.

9. Under sec 2(6) of the Consumer Protection Act 2019, a complaint means allegation made in writing made by a complainant for obtaining any relief provided by or under the act and that includes the services hired or availed of or agreed to be hired or availed of by him suffer from any deficiency.

10. Under sec 2(11) of the Consumer Protection Act 2019, “deficiency”means, any fault, imperfection shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service and includes

(A) Any act of negligence or omission or commission by such person which cause the loss of injury to the consumer ; and

(B) Deliberate withholding of relevant information by such person to the consumer.

11.  Under sec 2(42) of the Consumer Protection Act 2019, “Service” means service of any descripttion which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, telecom, boarding or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service.

12.  In the light of the above, dear querist, you are well entitled to pursue your case t with consumer forum for insurance being a kind of service to be provided under Consumer Protection Act 2019 and the fact that the insurer withheld the relevant information from you being a consumer.

13.  However while pursuing the remedy with the consumer forum you need to keep in mind the following :-

The District Commission has jurisdiction to entertain the complaint about the goods and services complaint of, where the consideration amount does not exceed Rupees one crore .  [ sec 34(1) of the Consumer Protection Act 2019].

The state Commission has jurisdiction to entertain the complaint about the goods and services complaint of, where the consideration amount exceeds Rupees one crore but does not exceed Rupees Ten crore [ sec 47(1) of the Consumer Protection Act 2019].

The National Commission has jurisdiction to entertain the complaint about the goods and services complaint of, where the consideration amount exceeds Rupees Ten crore [ sec 58 (1) of the Consumer Protection Act 2019].

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