Many people in Karnataka are facing a roadblock with their insurance and other consumer-related grievances. Recent data shows that from 1989 to February 2025, around 74,117 complaints related to insurance were filed in the state and district commissions of Karnataka. The numbers show that insurance is the single largest sector for consumer grievances in the state.
The issue is prominent since it makes up about 23 per cent of all consumer disputes that are ongoing in the state. While around 67,500 of them have been resolved, over 6,500 cases are still pending and stuck in limbo.
The data is not just about the volume of consumer grievances but trust deficit between policyholders and insurance providers, particularly when it comes to claim settlements and policy interpretation.
Where are people struggling the most?
Insurance is at the forefront of consumer grievances but the problem is not limited to just one sector. Banking services comes up second with 35,823 complaints and the private housing sector follows closely with 35,079 cases.
The data, reported by the Times of India, notes that the banking sector has managed to resolve most of its cases, however over 1,700 cases are still pending. The private housing sector also has about 3,200 unresolved disputes lying around.
The consumer commissions say these key sectors, namely insurance, banking and housing - see the most disputed because they are essential to daily life and consumers simply can't afford to be passive when things go wrong here.
Denied Claims & Legal Loopholes
Customers often fall prey to misleading ads (typically when it comes to loans), and also become a victim of misinformation due to lack of proper disclosures (often during insurance purchases).
In the April 2025 issue of Outlook Money, we elaborated on some classic examples of misselling, where a product or service is sold to someone for whom it is not suitable. The most common grievance is that of misselling of insurance products, but those are not the only ones to be mis-sold.
The problem of misselling includes aggressive mutual funds, bundled products, personal loans, and more wherein ignorant consumers are at a loss, while banks and relationship managers flurry to meet their targets at your expense.
Know Your Rights
Consumers should be aware that even if legal channels like RERA (for housing) and insurance provider’s grievance redressal systems, etc., fail to provide justice, there is always the option of seeking redressal through consumer commissions and courts.
Goods, Utilities, Health: Grievances Beyond Financial Services
Though insurance, banking, and housing sectors may dominate the headlines for consumer grievances, many other sectors also contribute to the load of Karnataka’s consumer commissions, such as:
Defective household goods: 11,439 cases (507 pending)
Electricity disputes: 9,099 cases (247 pending)
Telecom Issues: 7,210 cases (60 pending)
Medical negligence and hospital services: 4,569 complaints (510 pending)
Educational institutions: 4,029 complaints (122 pending)
Road transport services: 3,829 complaints (52 pending)
Railways: 1,21 (55 pending)
Airlines: 1,590 complaints (81 pending)
There are many other complaints from the miscellaneous categories as well that include a wide range of services and products. These account for over 1.2 lakh cases so far, with about 3,045 still pending
E-commerce: A new but ‘growing’ concern
Though it’s a small segment, e-commerce complaints have also stuck on the radar. So far, around 109 cases have been filed by the consumers, most in the last few years, but only 22 have been resolved leaving 87 pending.
With the coming of online retail chains like Amazon and Flipkart, the Consumer Protection Act, 2019 brought in new rules to make them more accountable.
What does this mean for consumers?
Even though the data is centric on Karnataka, the sheer number of pending Insurance complaints highlights the need for better consumer awareness and transparent claim procedures.
The insurance claim issues are a nationwide issue and a growing concern among policyholders. The fact that thousands of consumers, in one state, have had to approach legal commissions just to claim what’s rightfully theirs reflects a broader problem that needs urgent redressal.
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