Insurance survey:
Highlighting the widespread issue of manipulative selling in the insurance sector, a survey by LocalCircles found that six out of 10 consumers using online insurance sales and service platforms have encountered dark patterns like nagging, subscription traps, and forced actions.
The survey revealed that users frequently face dark patterns that compromise their choice, value, coverage benefits, and data. According to the findings, 61% of online insurance purchasers experienced a subscription trap, where cancelling the policy was made difficult by the platform.
Additionally, 86% of respondents reported that platforms often used a nagging approach when they requested an insurance quote or attempted to cancel a policy. Moreover, 57% mentioned that platforms frequently employed forced actions, such as requesting unnecessary personal details to provide a quote and sending unsolicited information or misusing these details. As more consumers turn to the internet to buy or renew insurance policies, complaints of mis-selling or manipulative selling—known as dark patterns in the online world—have increased over the past nine months.
Given the high prevalence of dark patterns among online insurance buyers, the survey suggests that the government, through the consumer rights regulator CCPA and the insurance regulatorI IRDA, should take further action to protect consumers.
The survey received over 36,000 responses from insurance consumers across 309 districts in India, with 66% of respondents being men and 34% women. It also noted that insurance agents or officials often fail to inform consumers about policy exclusions or drawbacks compared to other policies, or they aggressively sell policies to meet targets. Although there is a provision for consumers to return or cancel a policy if misled, many people trust agents and do not thoroughly read the documents during the consideration period when the policy can still be returned without financial loss.
These complaints align with the government’s notification in November 2023, prohibiting 13 types of dark patterns, including false urgency, basket sneaking, confirm shaming, forced action, subscription trap, interface interference, bait and switch, drip pricing, disguised advertisement, nagging, trick questions, SaaS billing, and rogue malware. According to the CCPA notification, dark patterns constitute misleading advertisements, unfair trade practices, or violations of consumer rights.
The survey explained that forced action dark patterns lead consumers to believe they cannot get a quote or make a comparison without following the platform’s directions, often causing them to disclose personal information they would otherwise keep private. Similarly, false urgency is created by falsely informing consumers that a product is only available for a limited time, exploiting their fear of missing out and discouraging them from reading all the available information. Websites, including insurance sites, sometimes use pre-selected options that are not necessarily in the consumers’ best interest and employ false hierarchies to promote or hide certain options.
