However, amid this insurance boom, all is not well with bank customers. If customer feedback is taken into account, mis-selling of insurance policies is rampant.
Even the wrong purchase of financial products also proves to be a cause of inconvenience for customers. Lots of stories galore telling tales of mis-selling of financial products, especially insurance policies, to gullible customers by bank officials at the counter. Those who cannot afford the insurance premium are obliged to purchase the insurance cover.
There are many cases where banks have forced borrowers to get insurance coverage and most of the times the insurance premium is deducted from their loan accounts. Even though customers are resentful of this practice, counter staff hardly give up on such practices.
In other words, loan disbursement has been held hostage to insurance products, with some banks forcing customers to take out specific insurance policies.
Some banks have even made it “compulsory” for borrowers to take out insurance cover before loan disbursement. Precisely what we find are cases where borrowers are wringing their hands to get them to take out specific insurance policies. Some of them are more expensive and useless.