A Rs 1 crore IRDAI penalty on Canara HSBC Life for selling an annuity to an 88-year-old is a useful case study in how mis-selling happens and how to reverse it. This guide gives the method and the data basis, then the practical steps.
Method and data basis
Based on the IRDAI order as reported by Outlook Money and Livemint, and on IRDAI's policyholder-protection framework. The product's approved entry age was 30 to 80; the buyer was 88; the annual premium was about Rs 2 lakh against a self-declared annual income of Rs 10 lakh.
Five red flags
- Buyer outside the product's approved age band.
- Premium large relative to stated income.
- No suitability or affordability assessment on record.
- Verification call that does not test understanding of the product.
- Inconsistencies in the proposal form.
What a senior buyer should check
- The approved entry age, printed in the policy or available from the insurer in writing.
- Whether the free-look period is still open; if so, cancellation and refund rights apply.
- Whether the product is single- or regular-premium, participating or non-participating, and when payouts begin.
- Who is the annuitant and who receives the annuity.
How to complain
Insurer's Grievance Redressal Officer, then bimabharosa.irdai.gov.in, then the Insurance Ombudsman. Keep the proposal, payment proof and correspondence. If a bank sold it, put the complaint to the bank's corporate-agent desk too.