With reference to the report, "Insurers held liable for misleading advertisements" (October 12), I wonder why regulatory agencies such as Insurance Regulatory and Development Authority and Advertisement Standards Council of India could not take action against Life Insurance Corporation of India for violating norms and taking customers for a ride.
Many a time, sellers (agents) do not provide customers the full details of an insurance product. For most unit-linked policies where customers are asked to make lump sum payments, the administration fee charged at 15 to 30 per cent of the initial premium is deducted from the first premium and only the balance is invested by the company in units. Often, agents do not reveal this fact to customers, fearing they would not invest the amount. When customers receive their annual statement, they get a shock seeing that the net asset value is less than the amount invested by them. Such short selling of policies by agents should be checked by the companies, if they wish to retain customers.
On the subject of advertisements, not only insurers, but many other companies are also taking customers for a ride. Look at FMCG products endorsed by celebrities. These companies are cashing in on the popularity of celebrities, who may not be using the products at all. Also, are celebrities not cheating their fans this way?
Similar is the case of models appearing in the attire of medical professionals and endorsing certain health products. Some medical professionals also endorse products. Is this not against the ethics of their profession? Why is the Indian Medical Association turning a blind eye to such ads?
Although quite late in the day, it is heartening to see that some celebrities have decided not to endorse products they do not use or which they believe will not do any good to the customer.
BCU Nair Kuthiathode
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