Date: Apr 12, 2014

To,
The Chairman,
Insurance Regulatory and Development Authority

rd
!loor, "arishram #havan
#asheer #agh
$ydera%ad &00004

'u%: Reliance (i)e and #harti A*A (i)e )raud selling o) li)e insurance products

Dear 'ir,

Greetings!

Thank you for your response to my RTI first appeal filed on 13 March 2014 I am also
happy to read in the media a!out the disclipinary action and fine imposed on Reliance
"o#e$er% I ha$e the follo#ing additional &ueries !ased on the response that the t#o
insurance companies ha$e apparently su!mitted to IR'( I !elie$e they are incomplete
and need further e)amination !y your office

Reliance *ife+ ,n 22 (ugust 2013% Reliance *ife has #ritten to IR'( stating that they ha$e
recei$ed 2%141 complaints -ear to 'ate .-T'/ against the corporate agent 0 (1 2apital
They specified that they do not ha$e any pending complaints "o#e$er% #e continue to
recei$e complaints a!out people !eing cheated !y (1 2apital and payments ha$e
continued to !e made until as recently as last #eek In this conte)t it is pertinent to ask +
1 "o# many complaints out of 2%141 recei$ed -T' till 22 (ugust 2013 #ere paid full
refund of premium3
2 "o# many further complaints ha$e !een recei$ed !y Reliance since 22(ugust 2013
until (pril 2014
3 "o# many of these ha$e !een paid a full refund and resol$ed3

4e !elie$e that Reliance *ife is only paying !ack those consumers #ho approach
Moneylife 5oundation #ith a complaint and #e for#ard the cases to the company 6$en
here% Reliance no# pays only those customers #ho ha$e taken the precaution to trap (1
2apital7s agents #ith a $oice recording "o#e$er% I am sure you #ill agree that not e$ery
consumer has a facility to conduct such a sting operation
I am enclosing a fe# cases #here Reliance *ife has refused the refund #ithout clear
e)planation I re&uest IR'( to seek an e)planation and to initiate a class8action to help all
$ictims of (1 2apital

Reliance *ife has paid o$er Rs2220 lakh to 31 people duped !y (1 2apital% until no# The
refunds ha$e !een in the range of Rs30%000 to Rs2 lakh This suggests a large scale fraud
that has not yet !een fully unearthed

9econdly% there are numerous cases of :interest free loan; offers !y 9ridhar Insurance
1roker% #hich makes it a copycat case of (1 2apital 6$en here% Relaince *ife has made
the necessary refunds to $ictims of 9ridhar Insurance 1roker This is e$en #orse than the
fraud !y (1 2apital% !ecause% as per IR'(7s o#n rules% an insurance !roker is supposed to
represent the customer and not the insurer 4e hope IR'( #ill in$estigate this and
initiate stringent action urgently
1harti (<( *ife+ 5rom the RTI response I ha$e recei$ed the follo#ing conclusions can !e
dra#n
,n 14 (ugust 2013 IR'( asked 1harti (<( *ife to gi$e :The data of total no of
complaints of this nature .mo!ile to#er rent offer/ recei$ed% resol$ed and pending as on
date; 1harti (<( *ife has not gi$en the re&uired information
(gain% on 1 =o$em!er .original letter date of 24 ,cto!er o$er#ritten/% IR'( asked the
same information to 1harti (<( *ife The RTI response does not indicate any resposne
from 1harti (<(
2an one conclude then% that 1harti (<( *ife is refusing to ans#er the regulator7s &ueries3
1harti (<( *ife has also offered flimsy reasons for denying the claim of >ish$ Ra? 9ingh
!y &uestioning #hether his son@s name is ,minder Rana The insurer states that customer
#as instigated !y 1M( 4ealth Insurance !roker In this case% either 1harti (2( is not
gi$ing IR'( correct informatioin or action is re&uired against 1M( 4ealth Insurance
4hile neither is happening% the customer is denied his claim 4e urge you to initiate
action that #ill gi$e ?ustice to the consumer
In another case of Rams#aroop 1eni#al% "anumangarh of Ra?asthan% he #as sold si)
policies of 1harti (<( *ife of RsA lakh annual premium !y luring him #ith the promise of
installing an (irtel To#er that #ould fetch a monthly rental of Rs1A lakh for him in fi$e
years 1harti (<( has !rushed a#ay the complaint stating :4e are declining client
concerned and standing on our decision; IR'( has asked for internal in$estigation report
on the complaint of Rams#aroop 1eni#al in its letter to 1harti (<( on 1 =o$em!er
.original letter date of 24 ,cto!er o$er#ritten/ 4e re&uest you to share the conclusion of
this in$estigation and action if any

4e re&uest your BRG6=T attention in this matter and action to protect innocent
customers #ho ha$e !een duped !y Reliance *ife and 1harti (<( *ife

4e #ould like to keep #orking #ith IR'( to !ring to light cases of fraud and misselling
in order to !enefit consumers through deterrant regulatory action

With Best Regards,


Sucheta Dalal
Trustee
Moneylife Foundation

.cc

'r G Mallikar?un
,9' .Grie$ances/
2onsumer (ffairs 'epartment

Clease note+ Moneylife 5oundation has sent details of se$eral cases #ith their policy
num!ers and emails #e ha$e recei$ed from our mem!ers% along #ith this letter to IR'(
for in$estigation "o#e$er% #e are not uploading them here for pri$acy reasons