LocalCircles urges "privacy zuckering" inclusion in India's dark pattern rules

Consumer advocacy group LocalCircles has called on India's Insurance Regulatory and Development Authority (IRDAI) and the Central Consumer Protection Authority (CCPA) to officially recognize "privacy zuckering" as a dark pattern.

This request follows a survey where 77% of users reported that online insurance platforms had used their personal information for spamming or to reject claims. The CCPA's 2023 guidelines do not currently list "privacy zuckering" among the 13 identified dark patterns. LocalCircles is urging regulators to prohibit the practice, conduct independent audits of insurance platforms, and penalize non-compliant companies.

"Privacy zuckering" describes user interface designs that intentionally prompt users to share more personal, health, or financial information than they intend. LocalCircles stated that this data can later be exploited by telecallers, intermediaries, and marketing teams, or used by insurers to reject claims.

The survey, which gathered responses from 22,119 individuals, found that 59% experienced "privacy zuckering" very frequently, with another 18% experiencing it sometimes. Other alleged dark patterns on insurance platforms included repeated calls or messages (90%), requests for unnecessary personal information (85%), discrepancies between advertised and final prices or terms (82%), difficulties in canceling policies (80%), and the late discovery of additional charges (65%).

LocalCircles highlighted that the implications extend beyond unwanted marketing. Insurers may use information provided during quote requests, health questionnaires, or sales conversations as grounds for non-disclosure or misrepresentation during claim assessments. Data shows that insurers disallowed health insurance claims worth approximately Rs 26,000 crore (around $310 million USD) in the fiscal year ending March 2024, making the methods of customer data collection a significant consumer protection issue.