Economy

Beware the ‘authentic’ insurance fraud

G Naga Sridhar M Somasekhar Hyderabad | Updated on January 16, 2018

Letters with official looking logos, signatures trap policy-holders

If you receive a letter from the Finance Ministry asking you to pay tax to claim refund of your lapsed insurance polices, beware. It will surely be fake.

Fraudsters are now sending letters with official logo purportedly from the Secretary, Department of Financial Services, Ministry of Finance, in a bid to trap the innocent and gullible.

In one such instance SM Soyeb received a letter from the Department of Distributions, Office of the Commissioner of Excise and Service Tax, Room No: 134, North Block, New Delhi. It claims that Regulatory Insurance Life (which does not exist!) had ‘decided’ to refund amount of lapsed polices to customers and he was eligible for ₹3.50 lakh.

Then comes the catch. To receive the amount, the person was asked to pay ₹26,315 as refundable tax to an account which will be informed to him later by a call centre, the letter states.

“I am seeing this kind of letter for the first time which calls for greater caution and awareness on the part of people,’’ Manoj Kumar Jain, Chief Executive Officer, Shriram Life Insurance, told Business Line when asked for his comment on the letter.

Increasing frauds in the form of spurious calls, emails and now these letters have become a massive concern for all stakeholders, he said while asking people to be very cautious. “In any such incident, a policyholder should first check with his insurance company,’’ he added.

The regulator, too, is worried. According to a senior IRDAI official, there has been a spurt in mis-selling and spurious calls from unauthorised and fake representatives, citing the name of reputed insurers. In some cases the fraudster have also cited that the regulator is asking people to make payments on false grounds.

IRDAI is currently running a television commercial to create awareness among the people on spurious calls and other frauds and is urging them to approach the police immediately.

Cautioning against the growing trend of frauds, a top LIC agent said, “Some tricksters are luring the vulnerable people with a bank account which has a name similar to major insurers and sending letters on Govt. officials with logo and seal to lend credibility”.

In the case of callers, often it’s a case of one-way (only incoming) and the caller asks for immediate payment of the processing fee for claiming the lapsed insurance policy.

Published on September 13, 2016

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