The Insurance Regulatory and Development Authority of India (IRDAI) has fined Shriram General Insurance Company Ltd with a fine of Rs 15 lakh for violating various norms, including using services of unlicensed entities, and giving unauthorised discounts in premium.
In conclusion, as directed under the respective charges, the penalty of Rs 15,00,000 shall be remitted by the general insurer by debiting shareholders’ account within a period of 15 days from the date of receipt of this order, IRDAI said in an order.
IRDAI slapped a fine of Rs 5 lakh on the company for using services of unlicensed entities for soliciting business in top 20 motor and personal accident policies.
The examination of 26 sample policies revealed that the premium was booked under direct code but the intermediary code on the cover note check form proves the involvement of unlicensed persons/entities in soliciting and procuring business.
Hence a penalty of Rs 5 lakh is levied on the general insurer, IRDAI said.
A similar penalty was imposed for violating provisions under file and use guidelines, offering discounts in premium other than filed with and approved by the Authority.
Similarly, another Rs 5 lakh fine was levied as the company deviated provisions of claim settlement and not adopting to standard procedure.
The insurer’s settlement of claims for reduced Insured’s Declared Value (IDV) in theft claims for whatever reasons is contrary to the provisions of Insured Declared Value of India Motor Tariff (IMT), 2002.
The insurer, therefore, absolved itself of the responsibility of paying due attention to the IDV in the policies and settled claims for less than IDV, it said.
Therefore, for the violation of GR 8 of Indian Motor Tariff, a penalty of Rs 5 lakh is levied on the general insurer.
Besides, IRDAI also warned Shriram General Insurance for marketing group insurance policies that deviated from the filed product.
The insurer’s submission that they had issued only one policy is taken on record.
However, the insurer is warned against issuing policies with terms and conditions at variance with that filed with and approved by the Authority, said the order.
Curated from Rs 15 lakh fine slapped on Shriram General Insurance