How do I get a refund for policies that were mis-sold to me?

I have multiple life insurance policies (endowment savings plans) from different insurers. An insurance agent had taken advantage of my advanced age and poor health condition to sell these policies by giving me false assurance of good returns. Also, I realized that the policies have wrong details about the policyholder and life-assured medical status.

I now want a full refund of my investments in these policies. Please let me know how to go about this.

—Name withheld on request

You should first get the corrections incorporated into the policies. You will need to submit the relevant KYC documents. This will help the insurer verify and process the correction. During this process, it would be helpful for you to keep some evidence of false disclosure by the insurance employee. An email trail of the medical history shared with the person or a written acknowledgment would be most useful.

When you update the insurer about your health conditions they may ask for more information. In many cases, particularly in investment-oriented plans, they will continue the insurance. However, they may decide to charge a loading or even cancel the insurance. If they cancel and you can establish that you were cheated, then they will return the premiums paid after adjusting for administrative expenses.

There is a provision in law that claims cannot be denied, unless there is patent fraud, after 3 years. This means that if the discrepancies in your health status are minor, then claims will be paid once 3 years are over. If the discrepancies are significant, the insurer could contest your claim.

If the insurer decides to retain the policy, then you could surrender the policy. The surrender value expected from endowment plans is mentioned in the policy schedule.

The surrender value increases with every year of paid premium. However, it is likely that when you surrender, you could lose some principal amount paid.

I am holding a health insurance policy for the last 10 years. In the previous year ended 31 March, I paid a total premium of ₹61,000. I turned 60 on 8 November and want to know how much deductions I will be entitled to under 80D for the previous financial year.

—Name withheld on request

Under 80D, higher deduction for health insurance premiums is available for senior citizens. Since, while paying the premium, you were not a senior citizen, you will be eligible for regular deduction of ₹25,000.

Do note that the insurance premium is also calculated accordingly. The premium payable in any given year is based on the last completed year of age. Do consult your tax advisor for a specific interpretation of the rules.