Buying insurance online may appear quick and convenient, but a March 2026 LocalCircles survey reported that more than 80% of participating users had encountered issues such as hidden charges, difficulty cancelling policies, forced data sharing or misleading pricing on online insurance platforms. These are survey findings, not regulatory adjudications against individual companies.
The LocalCircles study received more than 87,000 responses from users across 341 districts and was accompanied by an audit of more than 20 insurance platforms. The report describes patterns including subscription traps, nagging, forced action and bait-and-switch behaviour; its conclusions should be attributed to LocalCircles' survey and audit methodology.
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 several 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. In some cases, the final premium can go up five times the initial amount shown.
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
LocalCircles' audit covered platforms including Policybazaar, Acko, ICICI Lombard, Tata AIG, Bajaj Allianz, HDFC Ergo, Star Health, Go Digit, Coverfox and InsuranceDekho, and the organisation reported identifying two to four dark-pattern categories on each of the examined major platforms. This is a finding of the LocalCircles audit, not a final IRDAI or CCPA finding that any named company committed a legal violation.
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.
Following LocalCircles' March 18 representation, IRDAI on April 2, 2026 directed regulated entities offering insurance through digital platforms to conduct a self-assessment of compliance with the CCPA dark-pattern guidelines within 15 days, submit a report, and provide a time-bound action plan within one month where issues were identified.
Non-compliance can lead to regulatory action, including penalties under the Consumer Protection Act, 2019. The regulator has also partnered with the Institute of Public Auditors of India to independently identify and monitor dark patterns across the insurance sector over the next nine months.
How to Protect Yourself from Dark Patterns
For users, the findings show that buying insurance online requires extra caution. Here are some steps you can take to protect yourself:
- Check full pricing: Look for the final premium including all charges before making a decision.
- Read policy details carefully: Understand the terms, conditions, and exclusions before purchasing.
- Avoid sharing unnecessary data: Be cautious about sharing personal information just to get a quote.
- Understand cancellation rules: Know how to cancel the policy if you no longer need it.
- Watch out for pre-ticked add-ons: Review all selections carefully before finalising the purchase.
- Be aware of your rights: As a policyholder, you have the right to fair and transparent treatment.
Conclusion
The LocalCircles survey and platform audit point to widespread consumer concerns about dark-pattern practices in online insurance. The percentages in this article should be read as reported survey results, while legal or regulatory responsibility for a specific platform requires separate regulatory or adjudicatory findings.
Insurance is meant to provide financial protection. But for many users, the process of buying insurance online is becoming a challenge in itself. If you have been affected by dark patterns or feel you have been misled while purchasing insurance online, you are not alone.
If misleading online sales resulted in a policy that does not match what you were led to believe, see our insurance mis-selling guide for practical evidence and complaint steps.
If you are facing any issue with an insurance claim, policy cancellation, or mis-selling, do not fight alone. At Tatkal Claims, our team of claim experts specializes in helping policyholders navigate claim disputes, rejections, and delays. We understand the complexities of insurance contracts and the tactics insurers sometimes use to avoid payouts. Let us help you get the settlement you deserve. Visit Tatkal Claims today to know your rights and get expert assistance.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Please consult a qualified professional for legal matters.
