Insurance complaints jump 45% in Q2 2025; endowment policies top mis-sold list, says report

Indicating rising consumer dissatisfaction, insurance complaints rose by 45% in the second quarter of CY2025, according to the Q2 2025 Trends Report published by insurance grievance redressal platform Insurance Samadhan.

The report examined 4,004 cases with claims worth ₹75.4 crore, indicating that more customers are using grievance redressal platforms to seek justice. Disputes filed on the platform increased from 684 in Q1 to 974 in Q2, with the contested claim amount rising from ₹83.5 crore to over ₹119.5 crore, a growth of 43.10%.

According to the report, on a year-on-year basis, the company received 11.2% more complaints about mis-selling compared to Q2 CY2024, and the value of disputed claims increased by nearly 10%. Health insurance accounted for the largest share of grievances at 67.5%, followed by life insurance at 25.5%, and general insurance at 6.9%. Endowment policies were identified as the most mis-sold product category, which exposed policyholders to penalties, reduced returns, and capital erosion.

The 31-40 years age group was the most active in seeking redress, while Uttar Pradesh had the highest share of grievances at 16%. These findings reveal consumer vulnerabilities but also show how tools like the Polifyx app are empowering policyholders to check their policies through the ‘Know Your Policy’ feature, flag mis-selling, and file complaints quickly.

Looking at the increasing confidence of policyholders, Shilpa Arora, co-founder & COO of Insurance Samadhan, stated, “It shows that policyholders, especially younger generations, are willing to stand up for their rights, knowing there is a platform like Polifyx to rely on. This motivates us to work harder to protect consumer interests and restore faith in the $145.80 billion insurance industry.”

This insight comes at a time when instances of mis-selling are increasing due to the lure of commissions and pressure on agents to sell insurance products to meet their targets. In 2022-23, 20% of all complaints Irdai received against life insurers were about mis-selling, as per the report.

Of these, half of the complaints against private insurers involved unfair business practices, such as deceptive sales tactics. Through its Q2 2025 report, the grievance redressal platform aims to raise awareness about the role of digital tools in resolving complaints and making insurance policies easier to understand.