Mis-selling of financial products and services is not uncommon in India. Agents sometimes consciously hide facts to close the deal to achieve sales targets or for personal gains. Senior citizens can fall into these traps if they don’t pay close attention to the details of complex financial products being sold. That is why banks and insurers have made considerable efforts to reduce such cases. However, the only way to avoid such mistakes is for the customer to be alert and identify the red flags before a potential mis-selling occurs.

Unrealistic or Overly Complex Products:

If a salesperson is not explaining the product clearly, this should raise an alarm. The intention is to show only the positive side of the product or service. An example of mis-selling could be non-disclosure of the exclusions or waiting period in an insurance policy. So, if you believe a product or service is too good to be true, dig for more details.

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Pressure Selling:

Pressure selling tactic is another point to consider. When an agent forces you to make a quick decision on buying a product or to invest in a policy, do a second check. If you decide quickly without understanding the product, it may go against your interests. Usually, people succumb to pressure tactics when agents contact you at the end of a financial year to sell tax-saving products. Also, if you get a call from unknown numbers offering insurance or other financial products and special discounts, beware. Also, be careful of online scams and traps to defraud.

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Evading Questions:

It is a warning sign if an advisor is not answering your questions or providing incomplete information. Insurance policies come with different types and benefits. It can be complex for a layperson, so thoroughly research. Until you understand how the product works, it will defeat the very purpose of investing in it. Before investing, it is better to ask questions to understand the product’s risks, benefits, etc. Consult people familiar with the subject or agents to get a clear picture if you are not satisfied with the details provided.

While there are legal frameworks to curb mis-selling, people must also be financially aware and cautious. When in doubt, always ask about the product. By remaining vigilant and informed, seniors can safeguard their financial interests and avoid falling prey to mis-selling tactics.