Bengaluru: For many consumers, the real test of a bank or insurance policy begins when they need help. Increasingly, that is also when disputes begin. Banking and insurance complaints continued to rise in Karnataka during 2025-26, according to data from the Karnataka State Consumer Disputes Redressal Commission (KSCDRC), highlighting persistent concerns over claim rejections, service deficiencies and consumer awareness.
Rise in Complaints
Cases against banks increased from 35,954 in March 2025 to 37,897 in March 2026. Insurance-related complaints rose from 74,364 to 77,397 during the same period.
District-wise Breakdown
In banking-related cases, Belagavi topped with 13,240 cases filed and 12,601 disposed of, followed by Mysuru, which recorded 2,009 cases filed and 1,993 disposed, and Dharwad with 1,361 cases filed and 1,238 disposed of. In the insurance segment, Haveri led with 5,330 cases filed and 5,300 disposed of, followed by Dharwad with 3,567 cases filed and 3,397 disposed, and Gadag with 2,728 cases filed and 2,705 disposed of.
Consumer Struggles
Behind the numbers are consumers who say they are struggling to obtain settlements despite years of paying premiums. A 63-year-old resident of Jayanagar said he and his wife had purchased health insurance to avoid financial dependence during medical emergencies. However, when his wife underwent surgery, the insurer rejected the claim citing policy clauses that he said were never adequately explained.
"Despite paying nearly Rs 2-3 lakh in premiums over the years, we had to bear the expenses ourselves. Even after securing a consumer court order in our favour, we have not received the money," he said. A 53-year-old resident of Mysuru Road recounted a similar experience after undergoing surgery for a fracture. "The insurance company denied the claim, saying they do not cover such cases of minor fractures," he said.
Root Causes and Solutions
Consumer rights activists attribute many disputes to poor understanding of policy terms and inadequate communication at the time of sale. YG Muralidharan, founding member of Consumer Rights Education and Awareness Trust (CREAT), said consumers are often not informed about exclusions, cancellation clauses and other conditions until a dispute arises. He also called for greater consumer awareness programmes and stronger outreach efforts by regulators.
KSCDRC chairman Shivashankare Gowda said claim rejections and delays frequently occur on technical grounds. He urged consumers to fully understand policy conditions, disclose medical histories accurately and exercise caution while using online banking services.
Systemic Challenges
Data also shows 15 vacancies for presidents and 13 member posts across district consumer commissions. Despite staffing shortages, officials said Karnataka has improved case disposal rates through administrative reforms, with district commissions disposing of more than 97% of cases filed since inception.
