Buying and managing a life insurance policy is easy. Customers can purchase policies, pay premiums, update details and initiate service requests through their phones. But the same digital convenience is also giving fraudsters more ways to approach policyholders.
They use fake calls, messages, websites and payment links to make their pitches appear genuine. In many cases, they may even possess limited information about a customer’s policy, making the communication more convincing.
For policyholders, the biggest risk is not simply losing money. Sharing OTPs, passwords, banking details or policy credentials can expose them to further financial fraud.
“Digital technology has made life insurance far more accessible and convenient… However, as digital interactions grow, so do attempts by fraudsters to exploit trust,” said Sameer Bansal, managing director & chief executive officer, PNB MetLife.
Here are five common digital insurance frauds customers should be alert to.
1. Fake policy revival and bonus scams
A fraudster may contact a policyholder claiming that an old or inactive policy has accumulated a bonus or other benefit. The customer may then be asked to make an additional payment to release the money or revive the policy.
Such calls can appear credible when the caller has some basic information about the policy. The request for an immediate payment, however, should be treated as a warning sign.
Customers should independently contact their insurer through its official website or customer service number to check whether any payment or policy action is actually required.
2. Fake calls from insurance regulators
Fraudsters may impersonate officials of regulators or the government and claim that a policyholder’s insurance records require verification or that money is due to them.
The use of an official-sounding designation can make such calls particularly convincing. Customers should not rely on the caller ID, number or documents shared during the conversation.
If a caller claims to represent a regulator, verify the communication independently through the regulator’s official channels before sharing any information or making a payment.
3. Impersonation of insurance company officials
Another common tactic is to pose as an employee of the customer’s insurance company. The fraudster may claim that the existing policy has a problem, that money can be recovered from a surrendered policy, or that switching to another product could generate better returns.
The customer may then be sent a link, form or payment request. Some scams also involve asking the customer to share policy information or other confidential details.
Alok Rungta, managing director and chief executive officer, Generali Central Life Insurance, said fraudsters are using “fake calls, phishing messages, spoofed websites, and fraudulent payment links” to target customers.
He advised policyholders to transact only through official company channels and not respond to unsolicited communications. Customers should also never share OTPs, passwords, policy credentials or banking details with anyone.
4. Insurance-linked loan and benefit scams
Fraudsters can also lure policyholders with promises of loans, special benefits or other financial advantages linked to their insurance policies.
These offers may arrive through WhatsApp messages, SMS campaigns, social media advertisements or emails. The communication may use the name and branding of a genuine insurer, bank or financial institution to appear legitimate.
The customer may be asked to pay a processing fee, share documents or click on a link to claim the supposed benefit.
Before acting on such an offer, policyholders should check directly with the insurer whether the product or benefit exists and whether the communication is genuine.
5. Phishing, fake websites and payment frauds
Fake websites and payment links can closely resemble those of genuine insurers. Fraudsters may send messages asking customers to pay a premium, update their policy or complete a verification process.
A customer who clicks the link may be redirected to a fraudulent website designed to collect login credentials, card details, bank information or OTPs.
Rungta said technology and security controls are important for preventing fraud, but “informed customers are our strongest line of defence”. He said communications that create urgency, promise unusual benefits or ask for sensitive information should be independently verified through the insurer’s official channels.
What should policyholders do?
A few basic precautions can reduce the risk of falling for a digital insurance scam:
Use official channels: Access the insurer’s website or app directly rather than through links received in unsolicited messages.
Do not share OTPs: Legitimate insurers should not require customers to disclose OTPs, passwords or banking credentials over calls or messages.
Verify before paying: Check with the insurer if someone asks for a payment to revive a policy, release a benefit or process a loan.
Do not act under pressure: Urgency, guaranteed benefits and threats of policy cancellation are common warning signs.
Report suspicious communication: Contact the insurer through its official customer support channels if a message or call appears suspicious.
As Bansal said, legitimate companies will not ask customers to share sensitive information. For policyholders, the safest approach is simple: When a digital insurance communication asks for money or confidential information, stop and verify it independently before taking any action.
