Check policies first, insurance buyers told
Investors should think twice before buying a life insurance policy, especially if it involves a long-term contract, the Consumer Council warns.
Complaints about life insurance rose last year, and the watchdog said there could be a big difference between what a salesperson described and the actual terms of a policy.
In one case, a 76-year-old woman was persuaded to pay HK$250,000 for insurance when she tried to renew a different account.
Her family checked the details of the policy and learnt that she would not be able to access the capital or dividends for 10 years.
The company refused to refund the woman as the 21-day cooling-off period had expired.
In another case, a woman, 61, was offered what she believed was a 30-month investment-linked insurance policy with a monthly premium of HK$40,000. But when she sought the return of her money, she was told that the policy would last for 20 years and cost her HK$10 million. She later received a refund.
The council says other cases demonstrate the need to read policy documents carefully.
The council received 115 complaints about life insurance policies last year, up from 108 in 2010. Fourteen cases were filed in the first two months of this year, four of them concerning sales practices and seven fee disputes.
'Older people may find it difficult to understand terms of insurance policies. They should consult family members when buying such products,' said Ron Hui Shu-yuen, an official of the council.