Bank sold deferred annuity plan to 88-year-old super senior citizen; IRDAI fines insurer ₹1 crore

The Insurance Regulatory and Development Authority of India (IRDAI) has imposed a fine of ₹1 crore on Canara HSBC Life Insurance Company for mis-selling a deferred annuity life insurance plan to an 88-year-old super senior citizen through its corporate agent, Canara Bank.

In a press released dated September 10, 2026, the IRDAI said, "The Insurance Regulatory and Development Authority of India (IRDAI) passed an Order against M/s Canara HSBC Life Insurance Company Limited (‘Insurer’) pursuant to enforcement proceedings arising from allegations of mis-selling of a life insurance policy to an 88-year-old senior citizen."

The proceedings against the insurer were initiated after the authority took suo-motu cognizance of a social media post and sought explanations from the Insurer.

According to the press release, the case related to the sale of a deferred annuity policy with an annual premium of ₹2 lakh and a four-year premium-paying term, through the Insurer’s corporate agent, Canara Bank, to an 88-year-old customer, with his daughter shown as the annuitant.

On examination, IRDAI found that the approved product specified an entry age of 30 to 80 years, whereas the proposer was 88 years old. The competent authority also found that "adequate suitability and financial assessment had not been undertaken despite the customer’s advanced age and the significant premium commitment."

"Deficiencies were also observed in the verification call, proposal form, disclosure of policy features and other solicitation processes," the regulator said.

It was also found that that the benefit illustration did not have verifiable acknowledgement by the policyholder, the Customer Information Sheet and proposal form copy were not provided at the point of sale, premium was collected prior to policy issuance, and the consequences of the proposer’s death during the premium-paying term were not adequately disclosed.

"The Competent Authority held that, taken together, these deficiencies demonstrated failures in adherence to approved product features, suitability assessment, solicitation and verification, proposal processing, disclosure and internal controls, and constituted mis-selling and inadequate protection of the policyholder," the release said,

After the matter came to the IRDAI's notice, the insurer met the policyholder and, at his request, refunded the full premium of ₹4.09 lakh, including the second-year premium, and reversed the commission. The insurer also undertook corrective measures, including revision of the product brochure, policy document and suitability assessment framework, and introduction of pre-issuance video-based validation calls.

"After considering the facts and submissions, the Competent Authority imposed a penalty of ₹1 crore (Rupees One Crore only) under Section 102 of the Insurance Act, 1938, for violations of the IRDAI (Protection of Policyholders’ Interests, Operations and Allied Matters of Insurers) Regulations, 2024, the IRDAI (Corporate Governance for Insurers) Regulations, 2024 and provisions of the Master Circular on Protection of Policyholders’ Interests, 2024," the release said.