India’s insurance regulator has imposed a ₹1 crore penalty on Canara HSBC Life Insurance after findings of regulatory breaches in the sale of an annuity policy to an 88-year-old customer, raising concerns over oversight of bancassurance practices for senior clients.
India’s insurance regulator has penalised Canara HSBC Life Insurance ₹1 crore after finding serious lapses in the sale of a deferred annuity policy to an 88-year-old customer through Canara Bank. The case has drawn attention because the product was sold even though the proposer was above the policy’s stated entry age, raising fresh questions about how bancassurance sales are checked and supervised.
According to the Insurance Regulatory and Development Authority of India, the product, Smart Guaranteed Pension VI, carried an annual premium of ₹2 lakh for four years and had an entry age band of 30 to 80 years. The regulator said the sale involved failures in suitability assessment, verification, disclosure of key features, proposal scrutiny and monitoring of the sales process.
The Economic Times reported that the insurer later refunded ₹4.09 lakh to the affected customer, while Mint said the policyholder’s daughter was named as the annuitant. News9live reported that IRDAI took note of a social media post that drew attention to the sale, prompting the regulator to examine the matter.
The penalty was imposed under Section 102 of the Insurance Act, 1938, after IRDAI concluded that the shortcomings were not isolated but part of a wider pattern of regulatory breaches. Equitypandit reported that Canara HSBC Life disclosed the order to the stock exchanges and that the company had earlier replied to a show-cause notice and appeared for a personal hearing before the final decision was made.
IRDAI has also ordered the insurer to audit policies sold through Canara Bank to proposers or policyholders aged above 75 over three financial years ending March 31, 2026, and to review how it monitors corporate agents, proposal forms and product suitability. For older customers in particular, the case is a reminder that a bank counter is not a substitute for checking eligibility, reading the policy terms and confirming that the product actually fits the buyer’s needs.
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