Buying insurance online? 8 in 10 users say it can lead to problems

A nationwide survey has found that more than 80% of users faced issues such as hidden charges, difficulty with cancelling policies, forced data sharing and misleading pricing while using online insurance platforms.

In Short

• Over 80% of users face dark patterns on online insurance platforms
• 80% find it hard to cancel policies due to hidden or complex steps
• 90% experience persistent push to buy via calls and messages

Buying insurance online may look quick and convenient, but a large number of users in India say the experience comes with serious problems.

A nationwide survey has found that more than 80% of users faced issues such as hidden charges, difficulty with cancelling policies, forced data sharing and misleading pricing while using online insurance platforms.

The March 2026 study by LocalCircles, based on over 87,000 responses across 341 districts, highlights the growing use of “dark patterns” in insurance apps and websites.

These are tactics that push users to make decisions quickly, share personal information, or continue policies, often without full clarity on costs or terms.

WHAT ARE DARK PATTERNS AND HOW THEY AFFECT YOU

Dark patterns are design and sales tactics used on apps and websites to influence user behaviour without clear consent.

In insurance, the survey highlights five key types of dark patterns that users are facing.

Such practices are not limited to insurance and are commonly seen across e-commerce, travel booking and subscription-based platforms, where companies try to push users towards quicker or higher-value purchases.

They are often used to increase sales, collect user data, or reduce cancellations, even if it means making the process less transparent for consumers.

SUBSCRIPTION TRAPS MAKE EXIT DIFFICULT

This is one of the most common issues.

About 80% of users said that once they bought a policy, it became difficult to cancel it.

In many cases, users said cancellation options are not easy to find, or require multiple steps, delays or calls. The problem has worsened over time, rising from 61% to 80% in the last two years.

For users, this means getting locked into policies they may no longer want.

NAGGING AND CONSTANT PUSH TO BUY

Another major issue is constant pressure.

Around 90% of users said they were repeatedly pushed to buy or continue policies through calls, messages, pop-ups or reminders.

Nearly 70% said this happens very frequently.

This means even after showing no interest or trying to cancel, users continue to receive prompts, making it hard to step away.

FORCED DATA SHARING AND SPAM

Many users said they had to give personal details just to see policy options.

About 85% of users said they were forced to share unnecessary personal information to get a quote.

In many cases, this led to spam calls, messages or misuse of personal data. The share of such cases has sharply increased from 57% to 85%.

This raises concerns about both privacy and consent.

BAIT AND SWITCH PRICING

Pricing is another area where users feel misled.

Around 82% of users said they were shown attractive low prices at first, but the final cost of the policy or renewal turned out to be higher.

This means users often make decisions based on incomplete or misleading price information.

HIDDEN CHARGES AT THE FINAL STEP

Many users also reported extra charges appearing later.

About 65% of users said they faced hidden costs that were not clearly shown at the beginning but were added during purchase, renewal or even claims.

This makes it difficult for users to understand the true cost of the policy.

THE PROBLEM IS SPREAD ACROSS PLATFORMS

The study makes it clear that these practices are not limited to a few apps.

Most insurance platforms were found to use between two to four dark patterns at the same time.

This means users may face multiple issues in a single transaction without realising it.

REAL CASES SHOW HOW USERS ARE IMPACTED

The report also includes examples from users.

Some users said they paid premiums but did not receive policy documents for weeks. Others found that their policy details were changed after purchase.

There were also cases where users continued to receive calls even after asking platforms to stop contacting them.

These examples show how dark patterns affect users in real situations.

REGULATORS HAVE RAISED CONCERNS

The issue has also been flagged by policymakers.

Finance Minister Nirmala Sitharaman has said that mis-selling of financial products is now treated as an offence and warned banks against pushing insurance unnecessarily.

At the same time, the Reserve Bank of India has proposed stricter rules, including refunds in cases of mis-selling.

Despite these steps, the survey shows that such practices continue across insurance platforms.

For users, the findings show that buying insurance online requires extra caution.

It is important to check full pricing, read policy details carefully, avoid sharing unnecessary data, and understand cancellation rules before buying.

Insurance is meant to provide financial protection. But for many users, the process of buying insurance online is becoming a challenge in itself.

- Ends